Audit 316627

Finding Reference Number: 2023-002 NH Department of Military National Guard Military Operations and Maintenance (O&M) Projects (Assistance Listing #12.401) Federal Award Number: W012TF0190201001, W012TF023-27-2-1001 Federal Award Year: 2022, 2023 U.S. Department of Defense Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria The SF-270, Request for Advance or Reimbursement, must be submitted as part of the cash draw request process. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the SF-270 reporting process, we identified the following: A. For 31 of 33 SF-270 reports selected for testwork, we were unable to obtain documentation to support the amount reported within the following report line items to ensure that the amount reported was complete and accurate: • Line item a – total program outlays to date • Line item c – net program outlays • Line item e – total • Line item f – non-federal share of amount on line e B. For 12 of 33 reports selected for testwork, we were unable to agree line item h, federal payments previously received, to the supporting documentation provided. C. For all 33 SF-270 reports selected for testwork, we identified that there was a lack of segregation of duties related to the preparation of the SF-270 as there was no documented supervisory review performed over the completeness and accuracy of the report prior to submission.   Cause The cause of the condition found was due to insufficient policies and procedures to track total expenditures by appendix over the federal award year. For each federal fiscal year, a tracking sheet is used by appendix and the tracking sheet shows the federal share of the expenditures incurred each month. The tracking sheet does not represent the total expense incurred and if the appendix has a state share associated with the costs, the state portion is not included. When the SF-270 is prepared, documentation to support line items a, c, e and f is not maintained with the report to support accuracy of amounts reported. We further noted that the tracking sheets in some instances did not reconcile to the federal payments previously requested. The Department relies on the previous amount reported on the SF-270 only and did not identify the error as part of the preparation process of the SF-270 as there is no independent review to ensure it is complete and accurate. Effect The effect of the condition found is SF-270 reports submitted were not complete and accurate. Questioned Costs Not determinable Recommendation We recommend that the existing policies and procedures in place to prepare the SF-270 be reviewed and internal controls be implemented that will include an independent supervisory review to ensure that the SF-270 is complete and accurate at the time of submission. This would include ensuring that each line item of the SF-270 properly reconciles to supporting documentation and that the appropriate documentation for each line item is kept with each report to substantiate the amount reported. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-003 NH Department of Military National Guard Military Operations and Maintenance (O&M) Projects (Assistance Listing #12.401) Federal Award Number: W012TF0190201001, W012TF023-27-2-1001 Federal Award Year: 2022, 2023 U.S. Department of Defense Compliance Requirement: Cash Management Type of Finding: Material Weakness Prior Year Finding: None Statistically Valid Sample: No Criteria 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. This would include internal controls related to the cash management process. Condition As part of our testwork over the cash management process, we identified that was a lack of segregation of duties related to the preparation of the cash request amount and the approval and authorization for the amount to be drawn. During the year ended June 30, 2023, the same individual calculated and authorized each cash draw for the 33 cash draws selected for testwork. Cause The cause of the condition found was due to insufficient internal controls to ensure an independent supervisory review be performed over each cash draw request, resulting in a lack of segregation of duties. Effect The effect of the condition found is that an error in the cash draw amount calculated could be made and the error would not be identified timely. Questioned Costs None. Recommendation We recommend that internal controls be implemented that would result in a documented independent review over the amount calculated for the cash draw request to ensure that the amount drawn is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference: 2023-004 NH Governor’s Office of Emergency Relief and Recovery NH Department of Health and Human Services NH Department of Labor NH Department of Information Technology NH Department of Environmental Services NH Department of Business and Economic Affairs NH Governor’s Office of Emergency Relief and Recovery COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing #21.027) Federal Award Numbers: SLFRP0145 Federal Award Year: 2021 U.S. Department of Treasury Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-009 Statistically Valid Sample: No Criteria Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over procurement, suspension and debarment, we identified the following: A. As part of our testwork over procurement and suspension and debarment, management provided us a listing of new procurements entered into during the period ending June 30, 2023. From this listing, we selected a sample of 60 items for testwork and noted that 33 items appeared to be subrecipient grants and did not represent a new contract. As such, we were unable to verify the completeness and accuracy of the procurement population. While we were unable to verify the completeness and accuracy of the population, there was no impact on the amounts reported on the Schedule of Expenditures of Federal Awards related to amounts passed-through to subrecipients, as the population represented new procurements and as of June 30, 2023 there not been any expenditures incurred under the sample items selected for testwork. B. For 14 of 104 items selected for testwork related to suspension and debarment, there was no supporting documentation that the State had verified either through a signed certification or searching SAM.gov that the entity was not suspended or debarred. As part of our testwork, we reviewed SAM.gov for each of the 14 items and found that none of the entities had been suspended or debarred. Cause The cause of the condition found is due to insufficient controls and procedures to ensure that for all covered transactions the State determines if the entity covered has been suspended or debarred. In addition, there appears to be insufficient controls in place to properly classify contracts and subrecipient relationships. Effect The effect of the condition found is that the funds could be paid to an entity that has been suspended or debarred and costs paid to the entity would be unallowable. In addition, improper identification of contracts and subrecipients could lead to noncompliance with the State’s procurement policy or the proper monitoring of subrecipients. Questioned Costs Not determinable. Recommendation We recommend that the State review its existing policies and procedures related to suspension and debarment and ensure that all covered transactions with entities are properly reviewed to verify that the entity has not been suspended and debarred. In addition, the State should continue to review its vendor determination policy to ensure that the policy is consistently applied across all Department’s within the State. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder: As it relates bullet A, we were unable to obtain a population that was complete and accurate related to new procurement agreements that were entered into during the period ending June 30, 2023. From the population provided, of the 60 items selected for testwork, 33 items appeared to be subrecipient grants and did not represent a new contract.

Finding Reference Number: 2023-005 NH Department of Justice NH Department of Health and Human Services NH Department of Environmental Services NH Department of Business and Economic Affairs COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing #21.027) Federal Award Numbers: SLFRP0145 Federal Award Year: 2021 U.S. Department of Treasury Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-008 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorization purposes, complies with the terms and conditions of the subaward 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Coronavirus State and Local Fiscal Recovery Funds program, the State of New Hampshire (the State) entered into grant agreements with local entities to support allowable activities under the federal program. During the year ended June 30, 2022, the State passed through $73,337,682 to subrecipients. As part of our testwork over the subrecipient monitoring process, we identified the following breakdown of internal controls: A. As part of our testwork over subrecipient monitoring, we selected a sample of 49 items from the listing of subrecipients provided by the State that reconciled to the amount reported on the Schedule of Expenditures of Federal Awards. Of the 49 items selected for testwork, 6 items were contracts and were not subrecipient agreements. As such, we were unable to determine the completeness and accuracy of the subrecipient population. As a result of our audit, the State identified that this error resulted in the amount reported on the Schedule of Expenditures of Federal Awards as pass-through expenditures to be overstated by $7,261,684. The State has corrected the Schedule of Expenditures of Federal Awards so that the amount reported is accurate. B. The State communicates award information to subrecipients through the approved grant agreement. For 19 of the 43 remaining subrecipients selected for testwork, the State did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) was not communicated for 19 of the 43 remaining subrecipients selected for testwork. b. Identification of whether the award is R&D was not communicated for 17 of the remaining 43 subrecipients selected for testwork. C. As part of our testwork over during the award monitoring, it was identified that subrecipient monitoring activities include the review and approval of invoices submitted for reimbursement from the subrecipient. During our testwork over the invoice review we identified the following: a. For 6 of the remaining 43 subrecipients selected for testwork, we were unable to obtain the invoices paid by the State to verify that they were reviewed and approved. While the invoices were not provided to us, we noted that other monitoring procedures were performed for 4 of the 6 subrecipients. b. For 10 of the remaining 43 subrecipients selected for testwork, while we were able to obtain the invoices paid by the State, we were unable to properly identify who the appropriate reviewer was for the invoice to ensure that the individual who approved the invoice had the appropriate knowledge and competency to perform the review process. As a result, we were unable to verify if the invoice was appropriately reviewed. While we were unable to verify this, we noted that other monitoring procedures were performed for 9 of the 10 subrecipients. D. As part of our testwork over during the award monitoring, for 9 of the 43 remaining subrecipients selected for testwork, no documentation was provided to support that during the award monitoring procedures had been performed during the audit period. As such, we could not verify that appropriate monitoring procedures were performed as outlined by the subrecipient’s risk assessment. E. As part of our testwork over the review of Uniform Guidance Reports, we identified the following: a. For 6 of the remaining 43 subrecipients selected for testwork, the State provided the subrecipients Uniform Guidance report, however there was no evidence that the reports were reviewed to determine if a management decision letter needed to be issued. As part of our audit, we reviewed the 6 uniform guidance reports and did not identify any findings that would have required to be followed up on by the State. b. For 7 of the remaining 43 subrecipients selected for testwork, the subrecipient’s uniform guidance report was not provided. We reviewed the FAC to determine if a report was submitted during the audit period and identified that all 7 subrecipients had submitted a uniform guidance report. Of the 7 subrecipients, 1 report contained findings reported within Section III of the report. There was no evidence provided that the State had issued a management decision related to this subrecipient. Cause The cause of the condition found is primarily due to insufficient internal controls and procedures to ensure that award identification information is communicated, that appropriate during the award monitoring is performed based on the risk assessments and that all subrecipients are reviewed to determine if a uniform guidance audit was issued regardless of amount awarded to the subrecipient. Given the nature of this program, several Departments within the State entered into subrecipient grants resulting in a decentralized process. Not all Departments within the State are experienced with subrecipient relationships and may not have had developed policies to comply with subrecipient monitoring requirements. Finally, the State does not have sufficient internal controls in place to properly classify contracts and subrecipient relationships. Effect The effect of the condition found is that the State may not have properly monitored subrecipients in accordance with State policies and federal requirements. In addition, improper identification of contracts and subrecipients could lead to noncompliance with the State’s procurement policy or the proper monitoring of subrecipients. Questioned Costs None. Recommendation We recommend that the State review its existing internal controls, policies, and procedures to ensure that the State complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(d through (f), and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. Ensure that appropriate during the award monitoring is performed as outlined within the subrecipient’s risk assessment; and 3. All subrecipients are reviewed regardless of the amount awarded to determine if a uniform guidance report was issued and if a management decision letter should be issued. In addition, the State should continue to review its vendor determination policy to ensure that the policy is consistently applied across all Department’s within the State. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-006 NH Department of Business and Economic Affairs COVID-19 Capital Projects Fund (Assistance Listing #21.029) Federal Award Number: CPFFN0143 Federal Award Year: 2022 U.S. Department of Treasury Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria The Project and Expenditure Report for States, Territories & Freely Associated States (PRA 1505-0277) is required to be filed on a quarterly basis. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During state fiscal year 2023, the State was only required to file 1 quarterly Project and Expenditure Report and this report was filed for the quarter ending June 30, 2023. As part of our testwork reporting, we identified the following: A. The total amount expended for administrative expenses within Section 7.1 was under reported by $73,393. B. Within the 4.2A Broadband Infrastructure section of the report, we were unable to obtain documentation to support the total number of funded locations served by type within the planned column of the report for 1 of 2 projects reported. Specifically we were unable to tie out the following line items: a. F. Total Number of Funded Locations Served by Type – Residential: Planned amount of 20,549 b. G. Total Number of Funded Locations Served by Type – Total Housing Units: Planned amount of 20,549 c. H: Total Number of Funded Locations Served by Type – Business: Planned amount of 2,485 d. I: Total Number of Funded Locations Served by Type – Community Anchor Institutions: Planned amount of 225 C. Within the 4.2A Broadband Infrastructure section of the report, we were unable to obtain documentation to support the planned total miles of fiber to be deployed for 1 of 2 projects reported. Specifically we were unable to verify the accuracy of the total miles of fiber deployed (planned) of 2,676. Cause The cause of the condition found was due the existing internal control related to the review and approval of the report not being at a precision level that would identify the underreporting of expenses incurred during the month of June. In addition, as it relates to the number of funded locations and the planned number of miles of fiber to be deployed, documentation was not maintained to support the numbers that were included within the report. Effect The effect of the condition found is that the quarterly Project and Expenditure Report filed for the quarter ending June 30, 2023 was not have been complete and accurate. Questioned Costs None. Recommendation We recommend that the existing internal controls in place be evaluated to ensure that the precision level of the control performed is such that it would detect an error in the expenditures reported in comparison to the expenditures incurred within the general ledger and that all documentation used to support the amounts reported on the federal report are properly maintained. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-007 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Federal Award Numbers: S010A210029, S010A220029 Federal Award Year: 2022, 2023 U.S. Department of Education Compliance Requirement: Earmarking Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the special rule in section 1003(h) of the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the Every Student Succeeds Act (ESSA) that are codified in 2 CFR Part 170, starting with the 2018-2019 allocations, a State Educational Agency is required to not reduce a Local Educational Agency below its prior year’s Title I, Part A allocation in reserving funds for school improvement. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (LEAs) which are considered to be subrecipients . During our testwork over the Title I Earmarking of Targeting School Improvement Funds (SEAs), the engagement team identified that the allocations performed by the NH Department adjusted all LEA allocations for the SIG reduction, rather than just those LEAs whose allocation was greater than the prior year as required. The Department’s internal review of the FY23 allocations did not identify the calculation error in the SIG reduction formula which resulted in errors in the allocations to all LEAs. Cause The cause of the condition found is due to the management calculation error which was not identified during management’s review of the LEA allocations as the review was not being performed at a precise enough level to ensure timely and accurate Title I earmarking allocations to LEAs. Effect The effect of the condition found is that the Department did not comply with the special rule in section 1003(h) of the ESEA and as such funding to LEA’s was not accurate. KPMG notes this break down of internal control relates specific to the SIG earmarking requirement, not the determination of LEA eligibility for Title I funding as SIG does not impact actual LEA eligibility. Questioned Costs None as 100% was allocated. The error is within the calculation of allocated funds to the LEAs. Recommendation We recommend that the Department enhance the precision level of the internal controls across the Department programs to which SIG earmarking is applicable, to ensure accurate allocations to LEAs to ensure compliance with the targeting school improvement funds earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-010 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Number: NUK50CK000522 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Monthly fiscal reports are required to be submitted beginning 69 days after the notice of Awards is issued Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition FFATA Reporting During our testwork over FFATA reporting, we identified the following: A. For each of the 3 FFATA reports selected for testwork, there was no evidence provided that the report was reviewed and approved prior to submission. B. For each of the 3 FFATA reports selected for testwork, we were unable to validate certain data elements that were reported. Specifically, we identified the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 3 N/A N/A 2 3 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,126,552 N/A N/A $2,212,906 $7,126,552 Monthly Reporting As part of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program, the New Hampshire Department of Health and Human Services (the Department) reports financial information to the CDC on a monthly basis related to expenditures paid out and the amount of unliquidated obligations for the reporting period. During our testwork over monthly reporting, we identified that for 2 of the 40 reports selected for testwork, while the amount of unliquidated obligations and expenditures for the month selected appeared to be reported accurately, the total cumulative expenditures reported exceeded the amount awarded. Both of reports appeared to be related to the same project. Per review of the reports, the report filed for the month of February 2023 was over reported by $7,797 and the report filed for the month of May 2023 was over reported by $19,071 Cause The cause of the condition found related to FFATA reporting is due to insufficient controls related to the review and approval of FFATA reports to ensure the accuracy of the data reported. The cause of the condition found related to monthly reporting was the result of insufficient internal controls in place to ensure that that the report was accurate. For the 2 monthly reports identified, the CDC recently switched to a quarterly reporting process. When the report was filed, the Department inadvertently reported expenditures that had been previously reported in early months and was unable to identify that the error had occurred. Effect The effect of the condition found is that the Department did not comply with the Transparency Act and the Department submitted monthly federal reports that were inaccurate. Questioned Costs None. Recommendation We recommend that the Department implement policies, procedures and internal controls to ensure the accuracy of the data reported within FSRS is complete and accurate. We recommend that the Department continue to review its existing internal controls, policies, and procedures related to monthly reporting to ensure that all required monthly financial reports are reviewed to ensure the data in the report is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-010 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Number: NUK50CK000522 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Monthly fiscal reports are required to be submitted beginning 69 days after the notice of Awards is issued Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition FFATA Reporting During our testwork over FFATA reporting, we identified the following: A. For each of the 3 FFATA reports selected for testwork, there was no evidence provided that the report was reviewed and approved prior to submission. B. For each of the 3 FFATA reports selected for testwork, we were unable to validate certain data elements that were reported. Specifically, we identified the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 3 N/A N/A 2 3 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,126,552 N/A N/A $2,212,906 $7,126,552 Monthly Reporting As part of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program, the New Hampshire Department of Health and Human Services (the Department) reports financial information to the CDC on a monthly basis related to expenditures paid out and the amount of unliquidated obligations for the reporting period. During our testwork over monthly reporting, we identified that for 2 of the 40 reports selected for testwork, while the amount of unliquidated obligations and expenditures for the month selected appeared to be reported accurately, the total cumulative expenditures reported exceeded the amount awarded. Both of reports appeared to be related to the same project. Per review of the reports, the report filed for the month of February 2023 was over reported by $7,797 and the report filed for the month of May 2023 was over reported by $19,071 Cause The cause of the condition found related to FFATA reporting is due to insufficient controls related to the review and approval of FFATA reports to ensure the accuracy of the data reported. The cause of the condition found related to monthly reporting was the result of insufficient internal controls in place to ensure that that the report was accurate. For the 2 monthly reports identified, the CDC recently switched to a quarterly reporting process. When the report was filed, the Department inadvertently reported expenditures that had been previously reported in early months and was unable to identify that the error had occurred. Effect The effect of the condition found is that the Department did not comply with the Transparency Act and the Department submitted monthly federal reports that were inaccurate. Questioned Costs None. Recommendation We recommend that the Department implement policies, procedures and internal controls to ensure the accuracy of the data reported within FSRS is complete and accurate. We recommend that the Department continue to review its existing internal controls, policies, and procedures related to monthly reporting to ensure that all required monthly financial reports are reviewed to ensure the data in the report is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-011 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Numbers: NUK50CK000522 Federal Award Year: 2019 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-018 Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $5,070,789 of federal funding to subrecipient. As part of our testing related subrecipient monitoring, we noted the following: A. As part of our during the award monitoring testwork, we were unable to obtain documentation to support that that the Department had performed the suggested monitoring procedures for 3 of the 4 subrecipients selected for testwork based upon the subrecipients most recent risk assessment performed. For the remaining 1 subrecipient, the risk assessment form did not indicate the required frequency of the suggested type of monitoring. As a result, we were not able to verify that the Department had performed the appropriate monitoring procedures as outlined by the risk assessment performed for each subrecipient. B. The Department’s during the award monitoring for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. Per review of the risk assessment for each of the 4 subrecipients, the risk assessment did not provide for specific monitoring procedures that would address compliance with the subrecipients grant agreement beyond the period review of expenditure data. Taking into consideration that for each of the 4 subrecipients selected the testwork, if an Uniform Guidance report was issued for the subrecipient, this program was not audited as a major program, it does not appear that either the procedures suggested within the risk assessment or the procedures performed by the Department would be able to identify noncompliance incurred at the subrecipient level. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified the following: • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report. We noted however there were no findings identified within the uniform guidance report that would have required corrective action. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder As it relates to Bullet B above, for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. As it relates to Bullet C above, we were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued for 1 of 3 items selected for testwork. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. In addition, for 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report.

Finding Reference Number: 2023-011 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Numbers: NUK50CK000522 Federal Award Year: 2019 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-018 Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $5,070,789 of federal funding to subrecipient. As part of our testing related subrecipient monitoring, we noted the following: A. As part of our during the award monitoring testwork, we were unable to obtain documentation to support that that the Department had performed the suggested monitoring procedures for 3 of the 4 subrecipients selected for testwork based upon the subrecipients most recent risk assessment performed. For the remaining 1 subrecipient, the risk assessment form did not indicate the required frequency of the suggested type of monitoring. As a result, we were not able to verify that the Department had performed the appropriate monitoring procedures as outlined by the risk assessment performed for each subrecipient. B. The Department’s during the award monitoring for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. Per review of the risk assessment for each of the 4 subrecipients, the risk assessment did not provide for specific monitoring procedures that would address compliance with the subrecipients grant agreement beyond the period review of expenditure data. Taking into consideration that for each of the 4 subrecipients selected the testwork, if an Uniform Guidance report was issued for the subrecipient, this program was not audited as a major program, it does not appear that either the procedures suggested within the risk assessment or the procedures performed by the Department would be able to identify noncompliance incurred at the subrecipient level. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified the following: • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report. We noted however there were no findings identified within the uniform guidance report that would have required corrective action. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder As it relates to Bullet B above, for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. As it relates to Bullet C above, we were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued for 1 of 3 items selected for testwork. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. In addition, for 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report.

Finding Reference Number: 2023-012 NH Department of Health and Human Services Temporary Assistance for Needy Families and COVID-19 Temporary Assistance for Needy Families (Assistance Listing #93.558) Federal Award Numbers: 2021G996115, 2021G990228, 2022G996115 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Special Tests and Provisions: Penalty for Failure to Comply with Work Verification Plan Type of Finding: Significant Deficiency Prior Year Finding: 2022-024 Statistically Valid Sample: No The State agency must maintain adequate documentation, verification, and internal control procedures to ensure the accuracy of the data used in calculating work participation rates. In so doing, it must have in place procedures to (a) determine whether its work activities may count for participation rate purposes; (b) determine how to count and verify reported hours of work; (c) identify who is a work eligible individual; and (d) control internal data transmission and accuracy. Each State agency must comply with its HHS-approved Work Verification Plan in effect for the period that is audited. HHS may penalize the State by an amount not less than one percent and not more than five percent of the SFAG for violation of this provision (42 USC 601, 602, 607, and 609); 45 CFR sections 261.60, 261.61, 261.62, 261.63, 261.64, and 261.65). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork related to compliance with the New Hampshire Department of Health and Human Services (the Department) work verification plan we identified that for 2 of 60 participants selected for testwork, there was insufficient documentation to support the number of hours worked within the New Heights system for the participant. For the 2 participants, we identified that for 1 participant the number of hours worked appeared to be underreported and for 1 participant the number of hours appeared to be overreported. Cause The cause of the condition found was a result of inadequate review to ensure that the hours worked by each participant is accurately reported within the New Heights system. Effect The effect of the condition found is that the State may not be in compliance with its work verification plan and would not be able to identify the noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to enhance its existing internal controls and procedures to ensure that participant work hours reported agree to the documented hours worked and that the work hours are accurately reflected within the New Heights system. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-012 NH Department of Health and Human Services Temporary Assistance for Needy Families and COVID-19 Temporary Assistance for Needy Families (Assistance Listing #93.558) Federal Award Numbers: 2021G996115, 2021G990228, 2022G996115 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Special Tests and Provisions: Penalty for Failure to Comply with Work Verification Plan Type of Finding: Significant Deficiency Prior Year Finding: 2022-024 Statistically Valid Sample: No The State agency must maintain adequate documentation, verification, and internal control procedures to ensure the accuracy of the data used in calculating work participation rates. In so doing, it must have in place procedures to (a) determine whether its work activities may count for participation rate purposes; (b) determine how to count and verify reported hours of work; (c) identify who is a work eligible individual; and (d) control internal data transmission and accuracy. Each State agency must comply with its HHS-approved Work Verification Plan in effect for the period that is audited. HHS may penalize the State by an amount not less than one percent and not more than five percent of the SFAG for violation of this provision (42 USC 601, 602, 607, and 609); 45 CFR sections 261.60, 261.61, 261.62, 261.63, 261.64, and 261.65). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork related to compliance with the New Hampshire Department of Health and Human Services (the Department) work verification plan we identified that for 2 of 60 participants selected for testwork, there was insufficient documentation to support the number of hours worked within the New Heights system for the participant. For the 2 participants, we identified that for 1 participant the number of hours worked appeared to be underreported and for 1 participant the number of hours appeared to be overreported. Cause The cause of the condition found was a result of inadequate review to ensure that the hours worked by each participant is accurately reported within the New Heights system. Effect The effect of the condition found is that the State may not be in compliance with its work verification plan and would not be able to identify the noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to enhance its existing internal controls and procedures to ensure that participant work hours reported agree to the documented hours worked and that the work hours are accurately reflected within the New Heights system. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-013 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2101NHE5C6 Federal Award Year: 2021 U.S. Department of Health and Human Services Compliance Requirement: Earmarking Type of Finding: Significant Deficiency Prior Year Finding: 2022-028 Statistically Valid Sample: No Criteria Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition To ensure that the Department had met the required earmarking requirements related to administrative costs, the New Hampshire Department of Energy (the Department) maintains a tracking sheet for each federal grant that tracks all expenditures by category. At the end of the grant period, the total expenditures are reconciled to the federal grant and costs incurred related to the earmarking requirements are calculated to ensure that the required limitations are not exceeded. During our testwork over earmarking, we noted that for the 1 grant award which ended during the period under audit, the grant appeared to have met the required earmarking requirements, however we were unable to test the completeness and accuracy of the underlying support provided by management. Specifically, we were unable to reconcile the total expenditures contained within the underlying support to the final grant close out report (the SF-425) submitted for the grant. Cause The cause of the condition found is due to the Department is unable to submit a final close out report within the federal reporting portal as the portal does not contain an option to complete the required report. As a result, the last federal report filed for this grant was as of September 30, 2022, which was prior to the liquidation of all obligations under the grant. Effect The effect of the condition found is that the expenditures utilized to track compliance with the earmarking requirement may not reconcile to the final expenditures reported within the SF-425 resulting in noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to work with the federal government to ensure that all grants that are required to be closed out have a final SF-245 and that the final expenditures reported reconciles to the expenditures used to track the required earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-013 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2101NHE5C6 Federal Award Year: 2021 U.S. Department of Health and Human Services Compliance Requirement: Earmarking Type of Finding: Significant Deficiency Prior Year Finding: 2022-028 Statistically Valid Sample: No Criteria Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition To ensure that the Department had met the required earmarking requirements related to administrative costs, the New Hampshire Department of Energy (the Department) maintains a tracking sheet for each federal grant that tracks all expenditures by category. At the end of the grant period, the total expenditures are reconciled to the federal grant and costs incurred related to the earmarking requirements are calculated to ensure that the required limitations are not exceeded. During our testwork over earmarking, we noted that for the 1 grant award which ended during the period under audit, the grant appeared to have met the required earmarking requirements, however we were unable to test the completeness and accuracy of the underlying support provided by management. Specifically, we were unable to reconcile the total expenditures contained within the underlying support to the final grant close out report (the SF-425) submitted for the grant. Cause The cause of the condition found is due to the Department is unable to submit a final close out report within the federal reporting portal as the portal does not contain an option to complete the required report. As a result, the last federal report filed for this grant was as of September 30, 2022, which was prior to the liquidation of all obligations under the grant. Effect The effect of the condition found is that the expenditures utilized to track compliance with the earmarking requirement may not reconcile to the final expenditures reported within the SF-425 resulting in noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to work with the federal government to ensure that all grants that are required to be closed out have a final SF-245 and that the final expenditures reported reconciles to the expenditures used to track the required earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-014 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance. (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Cash Management Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-027 Statistically Valid Sample: No Criteria U.S. Department of the Treasury (Treasury) regulations at 31 CFR 204 part 205 implement the Cash Management Act of 1990 (CMIA). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Catalog of Federal Domestic assistance that meet the funding threshold for a major federal program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Pass-through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient (2 CFR section 200.305(b)(1)). Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over performed over cash management related to the Low-Income Home Energy Assistance program, we noted the following: A. Under the State of New Hampshire’s Cash Management Agreement (CMIA), direct expenditures are to be drawn using the actual draw – monthly technique. Under this technique, the funds are to be requested monthly based on actual costs incurred during that 1-month period. The funding technique is interest neutral. During our testwork over the cash draw process, we noted the following: a. For 4 of 9 cash draws selected for testwork, the New Hampshire Department of Energy (the Department) did not draw funds timely resulting in the cash draw to be delinquent. Each of the 4 cash draw covered multiple months of activity. As the clearance pattern within the CMIA agreement is interest neutral, there was no interest impact because of the cash draws not being performed timely. B. The Department advances payments to subrecipients to ensure that they have sufficient cash on hand to pay for benefit payments. The Department passed through $52,485,098 to subrecipients during the year ended June 30, 2023. During our testwork over compliance with cash management, we noted that for the 4 cash advance payment samples selected for testwork, the Department was not able to provide sufficient evidence to support that the cash advance was spent within a time period that minimizes the time elapsed between the transfer of federal funds to the subrecipient and their disbursement for program purposes. The Department’s normal disbursement cycle of every 30 days. As such, it does not appear that the Department sufficiently minimized the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes. Cause The cause of the condition found was primarily due to insufficient resources to monitor and track cash draws to ensure they are performed timely in accordance with the clearance patten established within the CMIA agreement and to ensure that subrecipients either utilize advance funds timely or effectively evaluate the amount of funds they need on hand at the time of the advance payment. Effect The effect of the condition found is that the Department did not comply with the provisions of the CMIA as it relates to the timing of cash draws. In addition, the Department did not have sufficient policies and procedures in place to ensure the time elapsed between the transfer of federal funds to the subrecipient and their disbursement of funds for program purposes is minimized. As such the Department was not in compliance with 2 CFR section 200.305(b)(1). Questioned Costs None. Recommendation We recommend that the Department review its existing internal controls, policies, and procedures to ensure that all cash draws are performed timely and in accordance with the CMIA agreement. In addition, we recommend that the Department review its existing internal controls, policies and procedures relating to advancing funds to subrecipients to ensure that excess cash held by the subrecipients does not exceed 30 days. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-014 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance. (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Cash Management Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-027 Statistically Valid Sample: No Criteria U.S. Department of the Treasury (Treasury) regulations at 31 CFR 204 part 205 implement the Cash Management Act of 1990 (CMIA). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Catalog of Federal Domestic assistance that meet the funding threshold for a major federal program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Pass-through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient (2 CFR section 200.305(b)(1)). Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over performed over cash management related to the Low-Income Home Energy Assistance program, we noted the following: A. Under the State of New Hampshire’s Cash Management Agreement (CMIA), direct expenditures are to be drawn using the actual draw – monthly technique. Under this technique, the funds are to be requested monthly based on actual costs incurred during that 1-month period. The funding technique is interest neutral. During our testwork over the cash draw process, we noted the following: a. For 4 of 9 cash draws selected for testwork, the New Hampshire Department of Energy (the Department) did not draw funds timely resulting in the cash draw to be delinquent. Each of the 4 cash draw covered multiple months of activity. As the clearance pattern within the CMIA agreement is interest neutral, there was no interest impact because of the cash draws not being performed timely. B. The Department advances payments to subrecipients to ensure that they have sufficient cash on hand to pay for benefit payments. The Department passed through $52,485,098 to subrecipients during the year ended June 30, 2023. During our testwork over compliance with cash management, we noted that for the 4 cash advance payment samples selected for testwork, the Department was not able to provide sufficient evidence to support that the cash advance was spent within a time period that minimizes the time elapsed between the transfer of federal funds to the subrecipient and their disbursement for program purposes. The Department’s normal disbursement cycle of every 30 days. As such, it does not appear that the Department sufficiently minimized the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes. Cause The cause of the condition found was primarily due to insufficient resources to monitor and track cash draws to ensure they are performed timely in accordance with the clearance patten established within the CMIA agreement and to ensure that subrecipients either utilize advance funds timely or effectively evaluate the amount of funds they need on hand at the time of the advance payment. Effect The effect of the condition found is that the Department did not comply with the provisions of the CMIA as it relates to the timing of cash draws. In addition, the Department did not have sufficient policies and procedures in place to ensure the time elapsed between the transfer of federal funds to the subrecipient and their disbursement of funds for program purposes is minimized. As such the Department was not in compliance with 2 CFR section 200.305(b)(1). Questioned Costs None. Recommendation We recommend that the Department review its existing internal controls, policies, and procedures to ensure that all cash draws are performed timely and in accordance with the CMIA agreement. In addition, we recommend that the Department review its existing internal controls, policies and procedures relating to advancing funds to subrecipients to ensure that excess cash held by the subrecipients does not exceed 30 days. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-015 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-025 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required through the terms and conditions of the award, subaward monitoring must include following up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means; and 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Low-Income Home Energy Assistance program (LIHEAP), the New Hampshire Department of Energy (the Department) enters into grant agreements with local entities to provide services related to the eligibility determination process for the LIHEAP program (including the calculation of participant benefits) and payment of benefits to fuel providers. During the year ended June 30, 2023, $52,485,098 was passed through to subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following as of the year ending June 30, 2023: A. The Department communicates award information to subrecipients through the approved grant agreement. Per review of the grant agreement, for each of the 3 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Federal Award Identification Number (FAIN) b. Federal award date c. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) d. Identification of whether the award is R&D B. For the 1 programmatic monitoring review completed by the Department during the period under audit, the Department did not issue its programmatic monitoring report to the subrecipient timely after the monitoring review was completed. As a result, there was a delay in the subrecipient implementing its corrective action plan to address the findings identified during the programmatic monitoring review. Specifically, we noted the following: a. For the 1 programmatic monitoring review, the monitoring review took place on May 4, 2023, but the report to the subrecipient was not issued until September 23, 2023. Per review of the report that was issued, there were findings identified by the Department that warranted corrective action. Due to the delay in issuing the report, a corrective action plan was not obtained from the subrecipient until almost 5 months after the date of that the monitoring review took place. C. For 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted the following: a. The Department does not track the receipt of uniform guidance reports. As a result, we were unable to determine when the uniform guidance reports were received by the Department to ensure they are reviewed timely. Specifically, we noted: i. For all 3 subrecipients selected, the subrecipient’s uniform guidance appeared to have been reviewed, but as the Department does not track the receipt of uniform guidance reports, it was unclear if it was reviewed timely. We did note based on the date that the uniform guidance report was issued, the management decision letter was not issued within 6 months of the date of the report being issued as required by 2 CRF 200.521 (d). ii. For 1 subrecipient in which the UG report had a finding, we were unable to obtain evidence to support that the Department had obtained and reviewed the subrecipient’s uniform guidance report, including management’s response to findings letter as well as the related Corrective Action Plan, as this subrecipient’s uniform guidance report noted a material weakness. E. The Annual Report on Households Assisted by LIHEAP contains data that is specific to benefits paid to eligible participants. The data that is used to compile the annual report is obtained from case data that is reported to the New Hampshire Department of Energy (the Department) from its subrecipients as the Department has entered into grant agreements with third parties who are responsible for the eligibility determination and benefit payment process. As part of our subrecipient monitoring testwork, we were unable to verify that the Department had performed any monitoring procedures over the data provided by each subrecipient to ensure that the data reported within the annual report was complete and accurate. Cause The cause of the condition found was primarily due to insufficient documented subrecipient policies and procedures to ensure that adequate monitoring is performed over subrecipients to align with the risk assessments performed. The monitoring procedures that are in place do not include the completeness and accuracy of the data submitted by the subrecipient utilized to compile federal reports. Further, the Department does not have sufficient internal controls and procedures to ensure results of monitoring visits are performed and results communicated timely to subrecipient or to ensure that subrecipient uniform guidance reports are obtained and reviewed timely. In addition, there are insufficient internal controls in place to review the grant agreements to ensure that all required data elements are communicated to the subrecipient in accordance with 2 CFR section 300.332(b). Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), section 200.332(b) and 2 CFR section 200.521. Questioned Costs None. Recommendation We recommend that the Department formalize, policies and procedures and implement the necessary internal controls to ensure that the Department complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(b) and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. As a result of the risk assessment performed, monitoring activities are performed over subrecipients to ensure compliance with the terms and conditions of its subrecipient grant agreement. The results of all monitoring reviews should be timely communicated in accordance with the Department’s policies to the subrecipient and actions requiring corrective action plan should be followed up on to ensure that the matter is resolved; and 3. Ensure that all uniform guidance reports are collected and reviewed timely so that a management decision letter can be issued within the time period required by federal regulations. Retain evidence of Department review of uniform guidance reports and management letters issued as a result of their review. View of Responsible Officials: Management partially concurs with the finding above Rejoinder As it relates to Bullet C above, for 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy

Finding Reference Number: 2023-015 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-025 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required through the terms and conditions of the award, subaward monitoring must include following up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means; and 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Low-Income Home Energy Assistance program (LIHEAP), the New Hampshire Department of Energy (the Department) enters into grant agreements with local entities to provide services related to the eligibility determination process for the LIHEAP program (including the calculation of participant benefits) and payment of benefits to fuel providers. During the year ended June 30, 2023, $52,485,098 was passed through to subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following as of the year ending June 30, 2023: A. The Department communicates award information to subrecipients through the approved grant agreement. Per review of the grant agreement, for each of the 3 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Federal Award Identification Number (FAIN) b. Federal award date c. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) d. Identification of whether the award is R&D B. For the 1 programmatic monitoring review completed by the Department during the period under audit, the Department did not issue its programmatic monitoring report to the subrecipient timely after the monitoring review was completed. As a result, there was a delay in the subrecipient implementing its corrective action plan to address the findings identified during the programmatic monitoring review. Specifically, we noted the following: a. For the 1 programmatic monitoring review, the monitoring review took place on May 4, 2023, but the report to the subrecipient was not issued until September 23, 2023. Per review of the report that was issued, there were findings identified by the Department that warranted corrective action. Due to the delay in issuing the report, a corrective action plan was not obtained from the subrecipient until almost 5 months after the date of that the monitoring review took place. C. For 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted the following: a. The Department does not track the receipt of uniform guidance reports. As a result, we were unable to determine when the uniform guidance reports were received by the Department to ensure they are reviewed timely. Specifically, we noted: i. For all 3 subrecipients selected, the subrecipient’s uniform guidance appeared to have been reviewed, but as the Department does not track the receipt of uniform guidance reports, it was unclear if it was reviewed timely. We did note based on the date that the uniform guidance report was issued, the management decision letter was not issued within 6 months of the date of the report being issued as required by 2 CRF 200.521 (d). ii. For 1 subrecipient in which the UG report had a finding, we were unable to obtain evidence to support that the Department had obtained and reviewed the subrecipient’s uniform guidance report, including management’s response to findings letter as well as the related Corrective Action Plan, as this subrecipient’s uniform guidance report noted a material weakness. E. The Annual Report on Households Assisted by LIHEAP contains data that is specific to benefits paid to eligible participants. The data that is used to compile the annual report is obtained from case data that is reported to the New Hampshire Department of Energy (the Department) from its subrecipients as the Department has entered into grant agreements with third parties who are responsible for the eligibility determination and benefit payment process. As part of our subrecipient monitoring testwork, we were unable to verify that the Department had performed any monitoring procedures over the data provided by each subrecipient to ensure that the data reported within the annual report was complete and accurate. Cause The cause of the condition found was primarily due to insufficient documented subrecipient policies and procedures to ensure that adequate monitoring is performed over subrecipients to align with the risk assessments performed. The monitoring procedures that are in place do not include the completeness and accuracy of the data submitted by the subrecipient utilized to compile federal reports. Further, the Department does not have sufficient internal controls and procedures to ensure results of monitoring visits are performed and results communicated timely to subrecipient or to ensure that subrecipient uniform guidance reports are obtained and reviewed timely. In addition, there are insufficient internal controls in place to review the grant agreements to ensure that all required data elements are communicated to the subrecipient in accordance with 2 CFR section 300.332(b). Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), section 200.332(b) and 2 CFR section 200.521. Questioned Costs None. Recommendation We recommend that the Department formalize, policies and procedures and implement the necessary internal controls to ensure that the Department complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(b) and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. As a result of the risk assessment performed, monitoring activities are performed over subrecipients to ensure compliance with the terms and conditions of its subrecipient grant agreement. The results of all monitoring reviews should be timely communicated in accordance with the Department’s policies to the subrecipient and actions requiring corrective action plan should be followed up on to ensure that the matter is resolved; and 3. Ensure that all uniform guidance reports are collected and reviewed timely so that a management decision letter can be issued within the time period required by federal regulations. Retain evidence of Department review of uniform guidance reports and management letters issued as a result of their review. View of Responsible Officials: Management partially concurs with the finding above Rejoinder As it relates to Bullet C above, for 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy

Finding Reference Number: 2023-016 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI, 1700NHLIEA Federal Award Year: 2017, 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-026 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The Low-Income Home Energy Assistance program (LIHEAP), Performance Data Form (OMB No. 0970-0449) must be submitted before January 31st regarding the prior federal fiscal year. The first section of the report is the Grant recipient Survey that collects and reports data on sources and uses of LIHEAP funds. The Grant recipient Survey includes Section III: Estimated Sources of Funds and Section IV: Estimated Use of LIHEAP Funds. Note: that these are referencing obligated not expended funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service. The Grantee Survey obligation amounts should be compared with the Carryover and Reallotment and FFR-425 reports. This reconciliation is needed to make sure the obligated balances for the program year being tested are accurate. LIHEAP Carryover and Reallotment Report (OMB No. 0970-0106) – Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported (42 USC 8626). Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) https://omb.report/icr/202211-0970-005 – As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Native American tribes are required to report only on the number of households served for each program component (42 USC 8629; 45 CFR section 96.82). Quarterly Performance and Management Report (OMB No. 0970-0589) https://omb.report/icr/202205-0970-017/doc/121847100 – Grant recipients must submit data and information about LIHEAP during the current FY, including success, challenges, needs and innovations. The quarterly reports focus on assisted households, performance management, obligation of funding, changes made due to anticipated increase in energy bills, collaboration with other utility programs, and training and technical assistance needs. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the Low-Income Home Energy Assistance program (LIHEAP), we noted the following: A. The New Hampshire Department of Energy (the Department) during the year ended June 30, 2023, $52,485,098 was passed through to subrecipients that met the requirements for first tier subawards under the Transparency Act and as such FFATA reports were required to be filed for each of those subawards. During our testwork over FFATA reporting at the Department of Energy, we selected 4 out of 7 FFATA reports for testing and noted the following: Reports Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 4 0 1 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $13,825,743 $0 $1,115,000 $0 $0 B. The annual LIHEAP Performance Data Form was not submitted by January 31, 2023. The Department submitted the report in December 2023. The Department was unable to provide sufficient underlying support for the Key Line items associated with the report including the following: Uses of Funds, the total Uses of Funds should equal the total Sources of Funds, and Other LIHEAP assistance. The Department was unable to provide a reconciliation between the LIHEAP Performance Data Form Grantee Survey obligation amounts reported to the Carryover and Reallotment and FFR-425 reports. C. The Department did not submit its required special reports (i.e. Quarterly Performance and Management Reports, Annual Report of Assisted Households Report, and LIHEAP Carryover and Reallotment Report) in a timely manner. There were also no procedures implemented to ensure that the submission of Special Reports includes accurate and complete data. Specifically, we noted the following: LIHEAP Carryover and Reallotment Report - This report must be submitted no later than August 1 for the federal fiscal year. This report was not submitted in a timely manner for the period ending 9/30/2022, as it was submitted on 8/9/2023 with an original due date of 8/1/2022. This report was not submitted in a timely manner for the period ending 9/30/2023, as it was not yet submitted as of March 12, 2024, with an original due date of 8/1/2023. The administrative expenditures balance utilized to calculate the PY22 Carryover balance submitted in the PY22 Carryover and Reallotment Report was an estimate, even though there was actual data for this balance since the report was submitted a year late. The actual balance per the support provided by the Dept. of Energy was $14,488.95, which is $20,337.05 less than the balance estimated. Annual Report on Households Assisted by LIHEAP - There is not a designated due date for this report. However, as this report is due at the end of every federal fiscal year, this should be submitted within a reasonable time after the end of the federal fiscal year (9/30) for the data to be reported in a timely manner to the Federal Government. The report for the year ending 9/30/2022 was submitted on 9/25/2023, which is almost an entire year after the end of the federal fiscal year, and the report for the year ending 9/30/2023 wasn't submitted until 1/23/2024, which is almost four months after federal fiscal year end. Additionally, some of the data submitted within the 9/30/2022 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted: In Section 1, line item 10. Weatherization the amount reported was 249 households and the amount per the underlying support was 7,262 households. In Section 2, line item 10. Weatherization the amounts reported for the various poverty levels was inaccurate per the underlying support, as shown in the below table. Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 10. Weatherization 33 38 43 38 97 Per Support: 2 Weatherization 1,013 1,122 1,123 1,163 2,841 Furthermore, all the data submitted within the 9/30/2023 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted for Sections 1 and 2 below: Section Data Field Amount per Report Amount per Support 1 1. Heating 29,642 31,289 e. Winter 1,680 1,730 10. Weatherization 199 9,875 14. Any type of LIHEAP assistance 29,669 31,289 18. Bill Payment Assistance 29,642 31,289 Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 1. Heating 3,190 3,238 3,519 3,710 15,985 e. Winter 332 172 164 182 830 10. Weatherization 10 22 26 19 122 Per Support: 2 Heating 4,040 4,074 4,432 4,329 14,414 Winter/Year Round Crisis 395 216 200 212 707 Weatherization 1,134 1,202 1,312 1,354 4,873 Quarterly Performance and Management Report - There is not a designated due date within for this report. However, as this report is due every quarter, this report should be submitted within the subsequent quarter for the data to be reported in a timely manner to the Federal Government. For 1 of the 3 quarterly reports submitted, we were unable to determine when it was submitted, as the report was not signed and dated by the Program Director when submitted. Additionally, for the Quarterly Performance and Management report submitted for the quarter ended 6/30/2022, we noted 2 key line items that were inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2022 was reported as 24,405 and the amount per the underlying support was 24,425, as well as the LIHEAP fiscal year end 2022 non-Supplemental (released November 1, 2021) amount of funds obligated was reported as $24,114,530 and the amount per the underlying support was $30,948,915. Additionally, we noted 7 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: total cumulative assisted households, total cumulative assisted households during the same period last year, total households for quarter 3 assisted during the same period last year, number of occurrences of households where LIHEAP prevented the loss of home energy for quarter 3, number of occurrences of households where LIHEAP restored home energy for quarter 3, total amount of funds obligated for ARPA 2021, amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 12/31/2022, we noted 3 key line items that were unable to be verified as complete and accurate as no underlying support could be provided by the Department. Those key line items are as follows: number of assisted households during the same period last year for quarter 1 federal fiscal year 2023, total amount of funds obligated for LIHEAP fiscal year 2023 allotment B, and amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 6/30/2023, we noted 1 key line item that was inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2023 was reported as 3,232 and the amount per the underlying support was 3,367. Additionally, we noted 2 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: amount of funds obligated for LIHEAP federal fiscal year 2023 allotment and amount of funds obligated for other supplemental allotment. Cause The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal FFATA reports were filed timely. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal performance reports were filed or filed timely as well as insufficient policies and procedures to ensure that the documentation to support the key line items reported on the LIHEAP Performance Data Form were retained. Additionally, the Department has insufficient policies and procedures to ensure that the required reconciliation between reported Performance Data Form Grantee Survey obligation amounts and Carryover and Reallotment report as well as FFR-425 reports is completed. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal special reports were filed or filed timely. Also, the Department had the Federal Government contract out a federal consulting firm, APRISE, to help the Department submit the required special reports and the federal consulting firm was not able to provide the Department with support for the data that was submitted within these reports. Effect The effect of the condition found is that the Department did not file required FFATA reports, LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP in a timely manner. The effect of the condition is also that the Department did not file complete and accurate performance and special federal reports. Questioned Costs None. Recommendation We recommend that the Department should review to ensure there is sufficient safeguards in place for professionals to perform when positions are vacant so that necessary processes are completed related to compliance with federal requirements, including federal reporting requirements related to the timely submission of the annual LIHEAP Performance Report, the annual LIHEAP Carryover and Reallotment Report, the Quarterly Performance and Management Report and the Annual Report on Households Assisted by LIHEAP as well as the submission of FFATA reports for first-tier subawards. In addition, we recommend that the Department implement written policies and procedures for the compilation and review of the LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP and ensure that the documentation to support the amounts reported is maintained to support that the report is complete and accurate. View of Responsible Official: Management concurs with the finding above.

Finding Reference Number: 2023-016 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI, 1700NHLIEA Federal Award Year: 2017, 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-026 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The Low-Income Home Energy Assistance program (LIHEAP), Performance Data Form (OMB No. 0970-0449) must be submitted before January 31st regarding the prior federal fiscal year. The first section of the report is the Grant recipient Survey that collects and reports data on sources and uses of LIHEAP funds. The Grant recipient Survey includes Section III: Estimated Sources of Funds and Section IV: Estimated Use of LIHEAP Funds. Note: that these are referencing obligated not expended funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service. The Grantee Survey obligation amounts should be compared with the Carryover and Reallotment and FFR-425 reports. This reconciliation is needed to make sure the obligated balances for the program year being tested are accurate. LIHEAP Carryover and Reallotment Report (OMB No. 0970-0106) – Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported (42 USC 8626). Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) https://omb.report/icr/202211-0970-005 – As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Native American tribes are required to report only on the number of households served for each program component (42 USC 8629; 45 CFR section 96.82). Quarterly Performance and Management Report (OMB No. 0970-0589) https://omb.report/icr/202205-0970-017/doc/121847100 – Grant recipients must submit data and information about LIHEAP during the current FY, including success, challenges, needs and innovations. The quarterly reports focus on assisted households, performance management, obligation of funding, changes made due to anticipated increase in energy bills, collaboration with other utility programs, and training and technical assistance needs. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the Low-Income Home Energy Assistance program (LIHEAP), we noted the following: A. The New Hampshire Department of Energy (the Department) during the year ended June 30, 2023, $52,485,098 was passed through to subrecipients that met the requirements for first tier subawards under the Transparency Act and as such FFATA reports were required to be filed for each of those subawards. During our testwork over FFATA reporting at the Department of Energy, we selected 4 out of 7 FFATA reports for testing and noted the following: Reports Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 4 0 1 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $13,825,743 $0 $1,115,000 $0 $0 B. The annual LIHEAP Performance Data Form was not submitted by January 31, 2023. The Department submitted the report in December 2023. The Department was unable to provide sufficient underlying support for the Key Line items associated with the report including the following: Uses of Funds, the total Uses of Funds should equal the total Sources of Funds, and Other LIHEAP assistance. The Department was unable to provide a reconciliation between the LIHEAP Performance Data Form Grantee Survey obligation amounts reported to the Carryover and Reallotment and FFR-425 reports. C. The Department did not submit its required special reports (i.e. Quarterly Performance and Management Reports, Annual Report of Assisted Households Report, and LIHEAP Carryover and Reallotment Report) in a timely manner. There were also no procedures implemented to ensure that the submission of Special Reports includes accurate and complete data. Specifically, we noted the following: LIHEAP Carryover and Reallotment Report - This report must be submitted no later than August 1 for the federal fiscal year. This report was not submitted in a timely manner for the period ending 9/30/2022, as it was submitted on 8/9/2023 with an original due date of 8/1/2022. This report was not submitted in a timely manner for the period ending 9/30/2023, as it was not yet submitted as of March 12, 2024, with an original due date of 8/1/2023. The administrative expenditures balance utilized to calculate the PY22 Carryover balance submitted in the PY22 Carryover and Reallotment Report was an estimate, even though there was actual data for this balance since the report was submitted a year late. The actual balance per the support provided by the Dept. of Energy was $14,488.95, which is $20,337.05 less than the balance estimated. Annual Report on Households Assisted by LIHEAP - There is not a designated due date for this report. However, as this report is due at the end of every federal fiscal year, this should be submitted within a reasonable time after the end of the federal fiscal year (9/30) for the data to be reported in a timely manner to the Federal Government. The report for the year ending 9/30/2022 was submitted on 9/25/2023, which is almost an entire year after the end of the federal fiscal year, and the report for the year ending 9/30/2023 wasn't submitted until 1/23/2024, which is almost four months after federal fiscal year end. Additionally, some of the data submitted within the 9/30/2022 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted: In Section 1, line item 10. Weatherization the amount reported was 249 households and the amount per the underlying support was 7,262 households. In Section 2, line item 10. Weatherization the amounts reported for the various poverty levels was inaccurate per the underlying support, as shown in the below table. Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 10. Weatherization 33 38 43 38 97 Per Support: 2 Weatherization 1,013 1,122 1,123 1,163 2,841 Furthermore, all the data submitted within the 9/30/2023 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted for Sections 1 and 2 below: Section Data Field Amount per Report Amount per Support 1 1. Heating 29,642 31,289 e. Winter 1,680 1,730 10. Weatherization 199 9,875 14. Any type of LIHEAP assistance 29,669 31,289 18. Bill Payment Assistance 29,642 31,289 Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 1. Heating 3,190 3,238 3,519 3,710 15,985 e. Winter 332 172 164 182 830 10. Weatherization 10 22 26 19 122 Per Support: 2 Heating 4,040 4,074 4,432 4,329 14,414 Winter/Year Round Crisis 395 216 200 212 707 Weatherization 1,134 1,202 1,312 1,354 4,873 Quarterly Performance and Management Report - There is not a designated due date within for this report. However, as this report is due every quarter, this report should be submitted within the subsequent quarter for the data to be reported in a timely manner to the Federal Government. For 1 of the 3 quarterly reports submitted, we were unable to determine when it was submitted, as the report was not signed and dated by the Program Director when submitted. Additionally, for the Quarterly Performance and Management report submitted for the quarter ended 6/30/2022, we noted 2 key line items that were inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2022 was reported as 24,405 and the amount per the underlying support was 24,425, as well as the LIHEAP fiscal year end 2022 non-Supplemental (released November 1, 2021) amount of funds obligated was reported as $24,114,530 and the amount per the underlying support was $30,948,915. Additionally, we noted 7 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: total cumulative assisted households, total cumulative assisted households during the same period last year, total households for quarter 3 assisted during the same period last year, number of occurrences of households where LIHEAP prevented the loss of home energy for quarter 3, number of occurrences of households where LIHEAP restored home energy for quarter 3, total amount of funds obligated for ARPA 2021, amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 12/31/2022, we noted 3 key line items that were unable to be verified as complete and accurate as no underlying support could be provided by the Department. Those key line items are as follows: number of assisted households during the same period last year for quarter 1 federal fiscal year 2023, total amount of funds obligated for LIHEAP fiscal year 2023 allotment B, and amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 6/30/2023, we noted 1 key line item that was inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2023 was reported as 3,232 and the amount per the underlying support was 3,367. Additionally, we noted 2 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: amount of funds obligated for LIHEAP federal fiscal year 2023 allotment and amount of funds obligated for other supplemental allotment. Cause The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal FFATA reports were filed timely. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal performance reports were filed or filed timely as well as insufficient policies and procedures to ensure that the documentation to support the key line items reported on the LIHEAP Performance Data Form were retained. Additionally, the Department has insufficient policies and procedures to ensure that the required reconciliation between reported Performance Data Form Grantee Survey obligation amounts and Carryover and Reallotment report as well as FFR-425 reports is completed. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal special reports were filed or filed timely. Also, the Department had the Federal Government contract out a federal consulting firm, APRISE, to help the Department submit the required special reports and the federal consulting firm was not able to provide the Department with support for the data that was submitted within these reports. Effect The effect of the condition found is that the Department did not file required FFATA reports, LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP in a timely manner. The effect of the condition is also that the Department did not file complete and accurate performance and special federal reports. Questioned Costs None. Recommendation We recommend that the Department should review to ensure there is sufficient safeguards in place for professionals to perform when positions are vacant so that necessary processes are completed related to compliance with federal requirements, including federal reporting requirements related to the timely submission of the annual LIHEAP Performance Report, the annual LIHEAP Carryover and Reallotment Report, the Quarterly Performance and Management Report and the Annual Report on Households Assisted by LIHEAP as well as the submission of FFATA reports for first-tier subawards. In addition, we recommend that the Department implement written policies and procedures for the compilation and review of the LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP and ensure that the documentation to support the amounts reported is maintained to support that the report is complete and accurate. View of Responsible Official: Management concurs with the finding above.

Finding Reference Number: 2023-017 NH Department of Health and Human Services Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) and COVID-19 Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) Federal Award Numbers: 1B08Ti084659-01, 1B08TI085821-01 Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $7,720,172 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. The Department provided the most recent risk assessment performed for each of the 7 subrecipients selected for testwork. Per review of the risk assessments provided, we identified the following: 1. For 5 of the subrecipients, the risk assessment indicated that the subrecipients expenditure detail should be examined monthly to ensure compliance with contract requirements and applicable laws and rules. We were unable to determine if this procedure had been performed as part of the Department’s subrecipient monitoring process. 2. For the remaining 2 subrecipients the recommended monitoring procedures was left blank on the risk assessment and as such we are unable to verify what type of monitoring procedures should have been performed. B. The Department’s during the award monitoring for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified that for 2 of 7 subrecipients selected for testwork, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department review its existing policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials Management partially concurs with the finding above. Rejoinder As it relates to Bullet A above, we were not able to obtain documentation to support that the suggested procedures outlined within the risk assessment was performed. As it relates to Bullet B above, for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement.

Finding Reference Number: 2023-017 NH Department of Health and Human Services Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) and COVID-19 Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) Federal Award Numbers: 1B08Ti084659-01, 1B08TI085821-01 Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $7,720,172 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. The Department provided the most recent risk assessment performed for each of the 7 subrecipients selected for testwork. Per review of the risk assessments provided, we identified the following: 1. For 5 of the subrecipients, the risk assessment indicated that the subrecipients expenditure detail should be examined monthly to ensure compliance with contract requirements and applicable laws and rules. We were unable to determine if this procedure had been performed as part of the Department’s subrecipient monitoring process. 2. For the remaining 2 subrecipients the recommended monitoring procedures was left blank on the risk assessment and as such we are unable to verify what type of monitoring procedures should have been performed. B. The Department’s during the award monitoring for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified that for 2 of 7 subrecipients selected for testwork, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department review its existing policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials Management partially concurs with the finding above. Rejoinder As it relates to Bullet A above, we were not able to obtain documentation to support that the suggested procedures outlined within the risk assessment was performed. As it relates to Bullet B above, for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement.

Finding Reference Number: 2023-018 NH Department of Health and Human Services Child Support Enforcement (ALN #93.563) Federal Award Number: 2201 NHCSES, 2301NHCSES Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria This program operates on a cash basis and each year’s funding and accounting is discrete; i.e., there is no carry-forward of unobligated funds. To be eligible for federal funding, claims must be submitted to ACF within two years after the calendar quarter in which the state made the expenditure. This limitation does not apply to any claim for an adjustment to prior year costs or resulting from a court-ordered retroactive adjustment (45 CFR sections 95.7, 95.13 and 95.19) 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the period of performance, we identified the following: A. For 3 of 40 payments selected for testwork that was charged during the last 60 days of the federal fiscal year 2022 federal grant, we identified there was no evidence that the payment had been reviewed and approved. All 3 sample items were related to journal entry vouchers charged to the program. As a result, it is unclear if the payment should have been charged to the federal award. B. For 4 of 40 payments selected for testwork that was charged during the first 60 days of the federal fiscal year 2023 federal grant, we identified there was no evidence that the payment had been reviewed and approved. All 4 sample items were related to journal entry vouchers charged to the program. As a result, it is unclear if the payment should have been charged to the federal award. Cause The cause of the condition found is that the Department does not appear to have sufficient internal controls to document the review and approval of journal entry vouchers that are charged to the program to support that the journal entry voucher has been properly authorized to be charged to the federal program. Effect The effect of the condition found is that unauthorized expenses may have been charged inappropriately to grant period based on the period of service in cost was paid. Questioned Costs $3,250 Recommendation We recommend that the Department review its existing policies and procedures related to the review and approval of journal entry vouchers to ensure that internal controls are implemented to document the review and approval of all journal entry vouchers to support that the journal entry voucher has been authorized to be charged to the federal program. View of Responsible Officials: Management concurs with the above finding.

Finding Reference Number: 2023-019 NH Department of Education Disability Insurance/SSI Cluster: Social Security-Disability (Assistance Listing #96.001) Federal Award Numbers: 1904NHDI00, 2024NHDI00, 2104NHDI00, 2204NHI00, 2304NHDI00 Federal Award Year: 2019, 2020, 2021, 2022, 2023 U.S. Social Security Administration Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No The SSA-4514, Time Report of Personal Services For Disability Determination Services, is due quarterly to account for employee time. The SSA-4513 – State Agency Report of Obligations for SSA Disability Programs – is due quarterly for each fiscal year still open in order to account for program disbursements and unliquidated obligations (POMS DI 39506.202). Additionally, 2 CFR 200.303 (a) states that non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting related to the SSA-4514 quarterly report, we identified the following: A. For the quarter ending September 30, 2022, the SSA-4514 report understated the reported number of hours as follows: a. Examiners duty hours by 241 hours and holiday/leave time by 7.50 hours. b. Hearing officers duty hours of 480 hours and holiday/leave time by 15 hours B. For the quarter ending June 30, 2023, the SSA-4514 report understated the reported number as follows: a. Hearing officers duty hours of 480 hours and holiday/leave time by 7.5 hours. During our testwork over federal reporting related to the SSA-4513 quarterly report, we identified the following: C. For all 10 SSA-4513 reports selected for testwork, line item 7 was not checked to identify if the SSA-871 needed to be attached to the report. It is unclear if this needed to be attached or not. D. For all 10 SSA-4513 reports selected for testwork, the reports did not reconcile to the internal tracking sheets provided to validate the amounts reported. For all reports there were variances between the tracking sheets and the dollar amounts included within the federal report within sections 1, 2, 3 and 4. While variances are identified, we noted that the variances were not material overall to the individual line item. E. For all 10 SSA-4513 reports selected for testwork, we were unable to validate the completeness and accuracy of the amounts reported within Section 1 for Columns (A) for Disbursements, (B) for unliquidated obligations and (C) total obligations for line items 1, 2, 3 and 4. As such, we are not able to validate that the amounts reported are complete and accurate. As we were not able to obtain documentation to validate the obligation balances, we are unable to validate the accuracy of amounts reported within Sections 1, 2, and 3 of the report. F. For all 10 of the SSA-4513 reports selected for testwork, documentation was not provided for all line items contained in the report. Specifically we identified the following: a. For 2 of 10 SSA-4513 reports selected for testing, documentation was not provided for Columns (A), (B) and (C) for the following line items: i. Line 2.a.1 Disability (DI) Claims ii. Line 2.a.2 Supplemental Security Income (SSI) Claims iii. Line 1.a.3 Concurrent DI/SSI Claims iv. Line 2.b.1 Disability (DI) Claims v. Line 2.b.2 Supplemental Security Income (SSI) Claims vi. Line 1.b.3 Concurrent DI/SSI Claims vii. Line 3 Indirect Costs b. For 2 of 10 SSA-4513 reports, documentation was not provided for Line Item Section 2. Other Nonpersonnel Costs per SSA-4513 (Total Obligation) c. For 7 of 10 SSA-4513 reports documentation was not provided for Line Item Section 2 Total Adjusted All Other Nonpersonnel Costs (B) d. For 10 of 10 SSA-4513 documentation was not provided for Line Item Section 2.d, Other: Identify obligation & amount G. For 3 of 10 SSA-4513 reports selected for testwork, we identified while there were no expenditures incurred for the federal grant between October 1, 2022 and June 30, 2023, the expenditures for the quarter selected, June 30, 2022, did not agree to what was reported for the quarter ending September 30, 2023. We were unable to obtain supporting documentation as to why the amounts reported were different. Cause The cause of the condition found related to the SSA-4514 was due to formula errors within the spreadsheet used to calculate the quarterly hours. The formulas were not updated to reflect any new lines of data that may have been added and needed to be includes within the total formulas included in the spreadsheet. While the spreadsheets were reviewed as part of the existing internal control procedures, the review as not at a precision level that detected the formula errors. The cause of the condition found related to the SSA-4513 was due to insufficient policies and procedures to ensure that all necessary documentation is maintained to support the amounts reported for each federal report filed. Based on the documentation that was provided to support the data reported within each quarterly report, it is unclear if the internal control review procedures performed included a detail review over each line item of the report to ensure the amount reported is complete and accurate. Effect The effect of the condition found is the SSA-4514 and SSA-4514 reports were not complete and accurate when they were filed. Questioned Costs None Recommendation We recommend that the existing internal control procedures over the review and approval of the SSA-4514 report are evaluated to ensure that the accuracy of spreadsheet formulas used are appropriate and capture all of the data necessary to accurately prepare the SSA-4514. In addition, we recommend that the existing policies and procedures be developed to ensure that all documentation to support the amounts reported on the SSA-4513 is properly maintained for each quarterly report. In addition, the existing internal control procedures should be evaluated to ensure that as part of the review process, each line item on the federal report is verified against the supporting documentation to ensure the report is complete and accurate. The review performed should also be properly documenting showing that the required review process was performed prior to submitting the SSA-4513. View of Responsible Officials: Managementconcurs with the above finding.

Finding Reference Number: 2023-020 NH Department of Education Disability Insurance/SSI Cluster: Social Security-Disability (Assistance Listing #96.001) Federal Award Numbers: 1904NHDI00, 2024NHDI00, 2104NHDI00, 2204NHI00, 2304NHDI00 Federal Award Year: 2019, 2020, 2021, 2022, 2023 U.S. Social Security Administration Compliance Requirement: Special Tests and Provisions – Qualified Providers Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Each state agency is responsible for comprehensive oversight management of its process and for ensuring accuracy, integrity, and economy of its processes (20 CFR sections 404.519g and 416.919g, and POMS DI 396569.300). As part of these duties, DDSs must have, and follow procedures for performing medical license verifications to ensure that only qualified providers perform DDSs tasks. By “qualified,” SSA means that the medical source must: 1. Be currently licensed in the state and have the training and experience to perform the type of examination or tests DDS requests; and 2. Not be barred from participating in Medicare or Medicaid programs or other federal or federally assisted programs (20 CFR sections 404.5159g and 416.919g). Prior to using the services of any medical provider, the DDS must check the System of Award Management (SAM) website. Additionally, 2 CFR 200.303 (a) states that non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the special test and provision related to qualified providers, we identified the following: A. For all 4 new providers selected for testwork, the SAM.gov website was not utilized to verify the suspension and debarment status for new providers. B. For 7 existing providers selected for testwork, we identified: a. For 4 of 7 annual reviews selected for testwork, there was no documentation maintained to verify that the providers medical license or suspension and debarment status had been reviewed. b. For 2 of 7 annual reviews selected for testwork, there was no documentation maintained that the providers suspension and debarment status had been reviewed. c. For 1 of 7 annual reviews selected for testwork, there was no documentation that an annual review of the provider had been performed. Cause The cause of the condition found is primarily due to insufficient policies and procedures to verify a provider’s suspension and debarment status has been reviewed within SAM.gov as required by the federal regulations. For new providers, the Office of Inspector General’s List of Excluded Individuals/Entities (LEIE) was reviewed, however the review took place after the provider was already hired. In addition, there does not appear to be any policies and procedures in place to document how an annual review should be conducted and what documentation needs to be maintained to support the procedures performed. There does not appear to be any internal controls in place to ensure that reviews are complete and properly documented. Effect The effect of the condition found is that documentation to support the qualifications of providers has not been appropriately maintained and providers could have been used that did not meet the criteria to be a qualified provider. Questioned Costs None Recommendation We recommend that written policies and procedures been developed to outline what the required procedures are related to reviewing professional licenses and suspension and debarment status for new providers and as part of the annual review process for existing providers. The policies should describe how the reviews will be performed, how the review will be documented. Internal controls should be implemented to ensure that an appropriate review over the review is conducted to ensure that the review is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-021 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Special Tests and Provisions - Project Accounting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria For large projects, the recipient is required to make an accounting to FEMA of eligible costs. Similarly, the subrecipient must make an accounting to the recipient. In submitting the accounting, the entity is required to certify that reported costs were incurred in performance of eligible work, that the approved work was completed, that the project is in compliance with the provisions of the FEMA-State Agreement, all grant conditions were met, and that payments for that project were made in accordance with the applicable payment provisions. For improved and alternate projects, if the total cost of the projects does not equal or exceed the approved eligible costs, then the auditor should expect to see an adjustment to reduce eligible costs (44 CFR section 206.205). Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During testwork over the Special Test- Project Accounting, the engagement team sampled 7 ongoing, large projects and 3 large, closed projects out of a total of 48 and 10, respectively. The engagement team noted the following: For 5 out of the 7 ongoing projects and for 2 out of the 3 closed projects, the Department could not provide evidence of project accounting reporting to FEMA in compliance with required certification. Specifically, the Department has a process whereby the Project Completion and Certification reports are to be completed and submitted to HSEM by subrecipients within 90 days of the project obligation date. HSEM then submits a certification report on the first of each month on the reports submitted during the previous month. However, the engagement team requested evidence of the certification report to FEMA and it could not be provided. Per discussion with HSEM staff, during the audit period, some of the emails were sent from individual employee state issued email addresses of individuals who no longer are employed by the Department and were not saved. Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the control not being at a precision level to ensure the accounting certification reports were sent to FEMA and maintained as evidence of control operation. Effect The effect of the condition found is that the Department did not comply with 44 CFR section 206.205 and 45 CFR section 75 303(a). Questioned Costs None. Recommendation We recommend that the Department enhance policies and procedures which include internal controls to ensure project accounting completion and certification reports are sent to FEMA and maintained on file as evidence of compliance with the Project Accounting certification requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-021 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Special Tests and Provisions - Project Accounting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria For large projects, the recipient is required to make an accounting to FEMA of eligible costs. Similarly, the subrecipient must make an accounting to the recipient. In submitting the accounting, the entity is required to certify that reported costs were incurred in performance of eligible work, that the approved work was completed, that the project is in compliance with the provisions of the FEMA-State Agreement, all grant conditions were met, and that payments for that project were made in accordance with the applicable payment provisions. For improved and alternate projects, if the total cost of the projects does not equal or exceed the approved eligible costs, then the auditor should expect to see an adjustment to reduce eligible costs (44 CFR section 206.205). Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During testwork over the Special Test- Project Accounting, the engagement team sampled 7 ongoing, large projects and 3 large, closed projects out of a total of 48 and 10, respectively. The engagement team noted the following: For 5 out of the 7 ongoing projects and for 2 out of the 3 closed projects, the Department could not provide evidence of project accounting reporting to FEMA in compliance with required certification. Specifically, the Department has a process whereby the Project Completion and Certification reports are to be completed and submitted to HSEM by subrecipients within 90 days of the project obligation date. HSEM then submits a certification report on the first of each month on the reports submitted during the previous month. However, the engagement team requested evidence of the certification report to FEMA and it could not be provided. Per discussion with HSEM staff, during the audit period, some of the emails were sent from individual employee state issued email addresses of individuals who no longer are employed by the Department and were not saved. Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the control not being at a precision level to ensure the accounting certification reports were sent to FEMA and maintained as evidence of control operation. Effect The effect of the condition found is that the Department did not comply with 44 CFR section 206.205 and 45 CFR section 75 303(a). Questioned Costs None. Recommendation We recommend that the Department enhance policies and procedures which include internal controls to ensure project accounting completion and certification reports are sent to FEMA and maintained on file as evidence of compliance with the Project Accounting certification requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-022 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-032 Statistically Valid Sample: No Criteria The SF-425, Federal Financial Report, is required to be filed annually. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the reporting, we noted the following: A. We noted for 1 out of 9 SF-425’s tested the total federal funds authorized (line 10d) per the SF-425 report did not agree to the SAG Smartlink Report. The SF-425 for disaster #4329 for the quarter ended 6/30/23 reported $6,893,951, while Smartlink reported $7,173,317. The Department did not update this amount on the SF 425, as the line should have read $7,173,317. The amount reported was the balance from the prior quarter. B. We noted for an additional 2 out of 9 SF-425s tested the recipient share figures (lines 10i-10k) were incorrectly calculated. When disaster declarations were made for disasters #4622 and #4624, the federal share was 75%. However, on August 8, 2022, amendments were executed that updated the federal share to 90%. When calculating the recipient share amounts on the SF-425s for these two disasters, HSEM utilized the old recipient share of 25%.One SF-425 report for disaster #4622 for the quarter ended 6/30/23 reported $338,319.94 for the total recipient shared required (line 10i) and $305,440.94 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $32.879. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $112,773.31, $101,813.65, and $10,959.66. The SF-425 report for disaster #4624 for the quarter ended 12/31/22 reported $204,156.96 for the total recipient shared required (line 10i) and $194,774.41 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $9,382.54. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $68,052.32, $64,924.80, and $3,127.52. Cause The cause of the condition found was primarily due to insufficient internal controls related to reporting. Specifically, there were no internal controls in place to detect inaccuracies in amounts reported on the SF-425 reports. Effect The effect of the condition found is that the Department did not file SF-425 reports accurately. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls over financial reporting at a precision level sufficient to ensure the accuracy of its federal reporting. We recommend that the Department revise the inaccurate SF-425 reports and resubmit the corrected versions. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-022 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-032 Statistically Valid Sample: No Criteria The SF-425, Federal Financial Report, is required to be filed annually. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the reporting, we noted the following: A. We noted for 1 out of 9 SF-425’s tested the total federal funds authorized (line 10d) per the SF-425 report did not agree to the SAG Smartlink Report. The SF-425 for disaster #4329 for the quarter ended 6/30/23 reported $6,893,951, while Smartlink reported $7,173,317. The Department did not update this amount on the SF 425, as the line should have read $7,173,317. The amount reported was the balance from the prior quarter. B. We noted for an additional 2 out of 9 SF-425s tested the recipient share figures (lines 10i-10k) were incorrectly calculated. When disaster declarations were made for disasters #4622 and #4624, the federal share was 75%. However, on August 8, 2022, amendments were executed that updated the federal share to 90%. When calculating the recipient share amounts on the SF-425s for these two disasters, HSEM utilized the old recipient share of 25%.One SF-425 report for disaster #4622 for the quarter ended 6/30/23 reported $338,319.94 for the total recipient shared required (line 10i) and $305,440.94 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $32.879. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $112,773.31, $101,813.65, and $10,959.66. The SF-425 report for disaster #4624 for the quarter ended 12/31/22 reported $204,156.96 for the total recipient shared required (line 10i) and $194,774.41 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $9,382.54. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $68,052.32, $64,924.80, and $3,127.52. Cause The cause of the condition found was primarily due to insufficient internal controls related to reporting. Specifically, there were no internal controls in place to detect inaccuracies in amounts reported on the SF-425 reports. Effect The effect of the condition found is that the Department did not file SF-425 reports accurately. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls over financial reporting at a precision level sufficient to ensure the accuracy of its federal reporting. We recommend that the Department revise the inaccurate SF-425 reports and resubmit the corrected versions. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-023 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements – Clearly identify to the subrecipient: (1) the award as a subaward at the time of subaward (or subsequent subaward modification) by providing the information described in 2 CFR section 200.332(a)(1); (2) all requirements imposed by the PTE on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and the terms and conditions of the award (2 CFR section 200.332(a)(2)); and (3) any additional requirements that the PTE imposes on the subrecipient in order for the PTE to meet its own responsibility for the federal award (e.g., financial, performance, and special reports) (2 CFR section 200.332(a)(3)). 2. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 3. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During the year ended June 30, 2023, $27,041,873 was passed through to 85 subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following: A. The Department communicates award information to subrecipients through the approved agreement. Per review of the agreement, for each of the 27 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332(a). Specifically, the following elements were not communicated: - Subrecipient unique entity identifier (not communicated for 19/27); - Federal Award Identification Number (FAIN) (not communicated for 27/27); - Identification of whether the award is R&D (not communicated for 27/27); and - Indirect cost rate for the federal award (including if the de minimis rate is charged) (not communicated for 27/27) B. The Department evaluated the subrecipient risk of noncompliance through a risk assessment for each of the 13 subrecipients selected for testwork. However, there was no formal risk assessment policy in place that indicated how frequently risk assessments should be performed. As a result, 5 subrecipients did not have risk assessments performed during the current year for purposes of determining the appropriate subrecipient monitoring response. These prior fiscal year(s) risk assessments were performed as of the following dates: September 2019, October and December 2021, May and June 2022. C. For each of the 13 subrecipients selected for testwork, the Department did not perform any during the award monitoring. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted there were no UG report review policies and procedures in place. For the 13 subrecipients selected for testwork, 6 subrecipients were identified in which the Department did not review the most recent uniform guidance report issued. Specifically, we noted: • For 5 of 13 subrecipients, the subrecipient’s uniform guidance was not reviewed due to updated risk assessments not being performed in the current year (refer to item 2 above) • For 1 of 13 subrecipients, the current year risk assessment was performed prior to the receipt of the subrecipient’s uniform guidance report and management did not go back to review the report Cause The cause of the condition found was primarily due to the Department not performing their sub monitoring internal controls in accordance with written formal policies and procedures. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a-h) and 2 CFR section 200.501(h). View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-023 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements – Clearly identify to the subrecipient: (1) the award as a subaward at the time of subaward (or subsequent subaward modification) by providing the information described in 2 CFR section 200.332(a)(1); (2) all requirements imposed by the PTE on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and the terms and conditions of the award (2 CFR section 200.332(a)(2)); and (3) any additional requirements that the PTE imposes on the subrecipient in order for the PTE to meet its own responsibility for the federal award (e.g., financial, performance, and special reports) (2 CFR section 200.332(a)(3)). 2. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 3. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During the year ended June 30, 2023, $27,041,873 was passed through to 85 subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following: A. The Department communicates award information to subrecipients through the approved agreement. Per review of the agreement, for each of the 27 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332(a). Specifically, the following elements were not communicated: - Subrecipient unique entity identifier (not communicated for 19/27); - Federal Award Identification Number (FAIN) (not communicated for 27/27); - Identification of whether the award is R&D (not communicated for 27/27); and - Indirect cost rate for the federal award (including if the de minimis rate is charged) (not communicated for 27/27) B. The Department evaluated the subrecipient risk of noncompliance through a risk assessment for each of the 13 subrecipients selected for testwork. However, there was no formal risk assessment policy in place that indicated how frequently risk assessments should be performed. As a result, 5 subrecipients did not have risk assessments performed during the current year for purposes of determining the appropriate subrecipient monitoring response. These prior fiscal year(s) risk assessments were performed as of the following dates: September 2019, October and December 2021, May and June 2022. C. For each of the 13 subrecipients selected for testwork, the Department did not perform any during the award monitoring. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted there were no UG report review policies and procedures in place. For the 13 subrecipients selected for testwork, 6 subrecipients were identified in which the Department did not review the most recent uniform guidance report issued. Specifically, we noted: • For 5 of 13 subrecipients, the subrecipient’s uniform guidance was not reviewed due to updated risk assessments not being performed in the current year (refer to item 2 above) • For 1 of 13 subrecipients, the current year risk assessment was performed prior to the receipt of the subrecipient’s uniform guidance report and management did not go back to review the report Cause The cause of the condition found was primarily due to the Department not performing their sub monitoring internal controls in accordance with written formal policies and procedures. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a-h) and 2 CFR section 200.501(h). View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-002 NH Department of Military National Guard Military Operations and Maintenance (O&M) Projects (Assistance Listing #12.401) Federal Award Number: W012TF0190201001, W012TF023-27-2-1001 Federal Award Year: 2022, 2023 U.S. Department of Defense Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria The SF-270, Request for Advance or Reimbursement, must be submitted as part of the cash draw request process. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the SF-270 reporting process, we identified the following: A. For 31 of 33 SF-270 reports selected for testwork, we were unable to obtain documentation to support the amount reported within the following report line items to ensure that the amount reported was complete and accurate: • Line item a – total program outlays to date • Line item c – net program outlays • Line item e – total • Line item f – non-federal share of amount on line e B. For 12 of 33 reports selected for testwork, we were unable to agree line item h, federal payments previously received, to the supporting documentation provided. C. For all 33 SF-270 reports selected for testwork, we identified that there was a lack of segregation of duties related to the preparation of the SF-270 as there was no documented supervisory review performed over the completeness and accuracy of the report prior to submission.   Cause The cause of the condition found was due to insufficient policies and procedures to track total expenditures by appendix over the federal award year. For each federal fiscal year, a tracking sheet is used by appendix and the tracking sheet shows the federal share of the expenditures incurred each month. The tracking sheet does not represent the total expense incurred and if the appendix has a state share associated with the costs, the state portion is not included. When the SF-270 is prepared, documentation to support line items a, c, e and f is not maintained with the report to support accuracy of amounts reported. We further noted that the tracking sheets in some instances did not reconcile to the federal payments previously requested. The Department relies on the previous amount reported on the SF-270 only and did not identify the error as part of the preparation process of the SF-270 as there is no independent review to ensure it is complete and accurate. Effect The effect of the condition found is SF-270 reports submitted were not complete and accurate. Questioned Costs Not determinable Recommendation We recommend that the existing policies and procedures in place to prepare the SF-270 be reviewed and internal controls be implemented that will include an independent supervisory review to ensure that the SF-270 is complete and accurate at the time of submission. This would include ensuring that each line item of the SF-270 properly reconciles to supporting documentation and that the appropriate documentation for each line item is kept with each report to substantiate the amount reported. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-003 NH Department of Military National Guard Military Operations and Maintenance (O&M) Projects (Assistance Listing #12.401) Federal Award Number: W012TF0190201001, W012TF023-27-2-1001 Federal Award Year: 2022, 2023 U.S. Department of Defense Compliance Requirement: Cash Management Type of Finding: Material Weakness Prior Year Finding: None Statistically Valid Sample: No Criteria 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. This would include internal controls related to the cash management process. Condition As part of our testwork over the cash management process, we identified that was a lack of segregation of duties related to the preparation of the cash request amount and the approval and authorization for the amount to be drawn. During the year ended June 30, 2023, the same individual calculated and authorized each cash draw for the 33 cash draws selected for testwork. Cause The cause of the condition found was due to insufficient internal controls to ensure an independent supervisory review be performed over each cash draw request, resulting in a lack of segregation of duties. Effect The effect of the condition found is that an error in the cash draw amount calculated could be made and the error would not be identified timely. Questioned Costs None. Recommendation We recommend that internal controls be implemented that would result in a documented independent review over the amount calculated for the cash draw request to ensure that the amount drawn is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference: 2023-004 NH Governor’s Office of Emergency Relief and Recovery NH Department of Health and Human Services NH Department of Labor NH Department of Information Technology NH Department of Environmental Services NH Department of Business and Economic Affairs NH Governor’s Office of Emergency Relief and Recovery COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing #21.027) Federal Award Numbers: SLFRP0145 Federal Award Year: 2021 U.S. Department of Treasury Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-009 Statistically Valid Sample: No Criteria Non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over procurement, suspension and debarment, we identified the following: A. As part of our testwork over procurement and suspension and debarment, management provided us a listing of new procurements entered into during the period ending June 30, 2023. From this listing, we selected a sample of 60 items for testwork and noted that 33 items appeared to be subrecipient grants and did not represent a new contract. As such, we were unable to verify the completeness and accuracy of the procurement population. While we were unable to verify the completeness and accuracy of the population, there was no impact on the amounts reported on the Schedule of Expenditures of Federal Awards related to amounts passed-through to subrecipients, as the population represented new procurements and as of June 30, 2023 there not been any expenditures incurred under the sample items selected for testwork. B. For 14 of 104 items selected for testwork related to suspension and debarment, there was no supporting documentation that the State had verified either through a signed certification or searching SAM.gov that the entity was not suspended or debarred. As part of our testwork, we reviewed SAM.gov for each of the 14 items and found that none of the entities had been suspended or debarred. Cause The cause of the condition found is due to insufficient controls and procedures to ensure that for all covered transactions the State determines if the entity covered has been suspended or debarred. In addition, there appears to be insufficient controls in place to properly classify contracts and subrecipient relationships. Effect The effect of the condition found is that the funds could be paid to an entity that has been suspended or debarred and costs paid to the entity would be unallowable. In addition, improper identification of contracts and subrecipients could lead to noncompliance with the State’s procurement policy or the proper monitoring of subrecipients. Questioned Costs Not determinable. Recommendation We recommend that the State review its existing policies and procedures related to suspension and debarment and ensure that all covered transactions with entities are properly reviewed to verify that the entity has not been suspended and debarred. In addition, the State should continue to review its vendor determination policy to ensure that the policy is consistently applied across all Department’s within the State. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder: As it relates bullet A, we were unable to obtain a population that was complete and accurate related to new procurement agreements that were entered into during the period ending June 30, 2023. From the population provided, of the 60 items selected for testwork, 33 items appeared to be subrecipient grants and did not represent a new contract.

Finding Reference Number: 2023-005 NH Department of Justice NH Department of Health and Human Services NH Department of Environmental Services NH Department of Business and Economic Affairs COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing #21.027) Federal Award Numbers: SLFRP0145 Federal Award Year: 2021 U.S. Department of Treasury Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-008 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorization purposes, complies with the terms and conditions of the subaward 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Coronavirus State and Local Fiscal Recovery Funds program, the State of New Hampshire (the State) entered into grant agreements with local entities to support allowable activities under the federal program. During the year ended June 30, 2022, the State passed through $73,337,682 to subrecipients. As part of our testwork over the subrecipient monitoring process, we identified the following breakdown of internal controls: A. As part of our testwork over subrecipient monitoring, we selected a sample of 49 items from the listing of subrecipients provided by the State that reconciled to the amount reported on the Schedule of Expenditures of Federal Awards. Of the 49 items selected for testwork, 6 items were contracts and were not subrecipient agreements. As such, we were unable to determine the completeness and accuracy of the subrecipient population. As a result of our audit, the State identified that this error resulted in the amount reported on the Schedule of Expenditures of Federal Awards as pass-through expenditures to be overstated by $7,261,684. The State has corrected the Schedule of Expenditures of Federal Awards so that the amount reported is accurate. B. The State communicates award information to subrecipients through the approved grant agreement. For 19 of the 43 remaining subrecipients selected for testwork, the State did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) was not communicated for 19 of the 43 remaining subrecipients selected for testwork. b. Identification of whether the award is R&D was not communicated for 17 of the remaining 43 subrecipients selected for testwork. C. As part of our testwork over during the award monitoring, it was identified that subrecipient monitoring activities include the review and approval of invoices submitted for reimbursement from the subrecipient. During our testwork over the invoice review we identified the following: a. For 6 of the remaining 43 subrecipients selected for testwork, we were unable to obtain the invoices paid by the State to verify that they were reviewed and approved. While the invoices were not provided to us, we noted that other monitoring procedures were performed for 4 of the 6 subrecipients. b. For 10 of the remaining 43 subrecipients selected for testwork, while we were able to obtain the invoices paid by the State, we were unable to properly identify who the appropriate reviewer was for the invoice to ensure that the individual who approved the invoice had the appropriate knowledge and competency to perform the review process. As a result, we were unable to verify if the invoice was appropriately reviewed. While we were unable to verify this, we noted that other monitoring procedures were performed for 9 of the 10 subrecipients. D. As part of our testwork over during the award monitoring, for 9 of the 43 remaining subrecipients selected for testwork, no documentation was provided to support that during the award monitoring procedures had been performed during the audit period. As such, we could not verify that appropriate monitoring procedures were performed as outlined by the subrecipient’s risk assessment. E. As part of our testwork over the review of Uniform Guidance Reports, we identified the following: a. For 6 of the remaining 43 subrecipients selected for testwork, the State provided the subrecipients Uniform Guidance report, however there was no evidence that the reports were reviewed to determine if a management decision letter needed to be issued. As part of our audit, we reviewed the 6 uniform guidance reports and did not identify any findings that would have required to be followed up on by the State. b. For 7 of the remaining 43 subrecipients selected for testwork, the subrecipient’s uniform guidance report was not provided. We reviewed the FAC to determine if a report was submitted during the audit period and identified that all 7 subrecipients had submitted a uniform guidance report. Of the 7 subrecipients, 1 report contained findings reported within Section III of the report. There was no evidence provided that the State had issued a management decision related to this subrecipient. Cause The cause of the condition found is primarily due to insufficient internal controls and procedures to ensure that award identification information is communicated, that appropriate during the award monitoring is performed based on the risk assessments and that all subrecipients are reviewed to determine if a uniform guidance audit was issued regardless of amount awarded to the subrecipient. Given the nature of this program, several Departments within the State entered into subrecipient grants resulting in a decentralized process. Not all Departments within the State are experienced with subrecipient relationships and may not have had developed policies to comply with subrecipient monitoring requirements. Finally, the State does not have sufficient internal controls in place to properly classify contracts and subrecipient relationships. Effect The effect of the condition found is that the State may not have properly monitored subrecipients in accordance with State policies and federal requirements. In addition, improper identification of contracts and subrecipients could lead to noncompliance with the State’s procurement policy or the proper monitoring of subrecipients. Questioned Costs None. Recommendation We recommend that the State review its existing internal controls, policies, and procedures to ensure that the State complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(d through (f), and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. Ensure that appropriate during the award monitoring is performed as outlined within the subrecipient’s risk assessment; and 3. All subrecipients are reviewed regardless of the amount awarded to determine if a uniform guidance report was issued and if a management decision letter should be issued. In addition, the State should continue to review its vendor determination policy to ensure that the policy is consistently applied across all Department’s within the State. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-006 NH Department of Business and Economic Affairs COVID-19 Capital Projects Fund (Assistance Listing #21.029) Federal Award Number: CPFFN0143 Federal Award Year: 2022 U.S. Department of Treasury Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria The Project and Expenditure Report for States, Territories & Freely Associated States (PRA 1505-0277) is required to be filed on a quarterly basis. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During state fiscal year 2023, the State was only required to file 1 quarterly Project and Expenditure Report and this report was filed for the quarter ending June 30, 2023. As part of our testwork reporting, we identified the following: A. The total amount expended for administrative expenses within Section 7.1 was under reported by $73,393. B. Within the 4.2A Broadband Infrastructure section of the report, we were unable to obtain documentation to support the total number of funded locations served by type within the planned column of the report for 1 of 2 projects reported. Specifically we were unable to tie out the following line items: a. F. Total Number of Funded Locations Served by Type – Residential: Planned amount of 20,549 b. G. Total Number of Funded Locations Served by Type – Total Housing Units: Planned amount of 20,549 c. H: Total Number of Funded Locations Served by Type – Business: Planned amount of 2,485 d. I: Total Number of Funded Locations Served by Type – Community Anchor Institutions: Planned amount of 225 C. Within the 4.2A Broadband Infrastructure section of the report, we were unable to obtain documentation to support the planned total miles of fiber to be deployed for 1 of 2 projects reported. Specifically we were unable to verify the accuracy of the total miles of fiber deployed (planned) of 2,676. Cause The cause of the condition found was due the existing internal control related to the review and approval of the report not being at a precision level that would identify the underreporting of expenses incurred during the month of June. In addition, as it relates to the number of funded locations and the planned number of miles of fiber to be deployed, documentation was not maintained to support the numbers that were included within the report. Effect The effect of the condition found is that the quarterly Project and Expenditure Report filed for the quarter ending June 30, 2023 was not have been complete and accurate. Questioned Costs None. Recommendation We recommend that the existing internal controls in place be evaluated to ensure that the precision level of the control performed is such that it would detect an error in the expenditures reported in comparison to the expenditures incurred within the general ledger and that all documentation used to support the amounts reported on the federal report are properly maintained. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-007 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Federal Award Numbers: S010A210029, S010A220029 Federal Award Year: 2022, 2023 U.S. Department of Education Compliance Requirement: Earmarking Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the special rule in section 1003(h) of the Elementary and Secondary Education Act of 1965 (ESEA), as amended by the Every Student Succeeds Act (ESSA) that are codified in 2 CFR Part 170, starting with the 2018-2019 allocations, a State Educational Agency is required to not reduce a Local Educational Agency below its prior year’s Title I, Part A allocation in reserving funds for school improvement. Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (LEAs) which are considered to be subrecipients . During our testwork over the Title I Earmarking of Targeting School Improvement Funds (SEAs), the engagement team identified that the allocations performed by the NH Department adjusted all LEA allocations for the SIG reduction, rather than just those LEAs whose allocation was greater than the prior year as required. The Department’s internal review of the FY23 allocations did not identify the calculation error in the SIG reduction formula which resulted in errors in the allocations to all LEAs. Cause The cause of the condition found is due to the management calculation error which was not identified during management’s review of the LEA allocations as the review was not being performed at a precise enough level to ensure timely and accurate Title I earmarking allocations to LEAs. Effect The effect of the condition found is that the Department did not comply with the special rule in section 1003(h) of the ESEA and as such funding to LEA’s was not accurate. KPMG notes this break down of internal control relates specific to the SIG earmarking requirement, not the determination of LEA eligibility for Title I funding as SIG does not impact actual LEA eligibility. Questioned Costs None as 100% was allocated. The error is within the calculation of allocated funds to the LEAs. Recommendation We recommend that the Department enhance the precision level of the internal controls across the Department programs to which SIG earmarking is applicable, to ensure accurate allocations to LEAs to ensure compliance with the targeting school improvement funds earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-008 Title I Grants to Local Educational Agencies (Assistance Listing #84.010) Supporting Effective Instruction State Grant (Title IIA (Assistance Listing #84.367) COVID-19 Education Stabilization Fund (Assistance Listing #84.425C, #84.425D, #84.425R, #84.425U, #84.425V, and #84.425W) Federal Award Numbers: S010A210029, S010A220029, S367A220028, S425D200017, S425D210017, S425U210017, S425U210017-21A Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Education Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-013, 2022-016 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $42,672,742 in Title I Grants to Local Educational Agencies (Title I Grant) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title I Grants, we selected 35 out of 132 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 35 0 28 0 1 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,616,436 $0 $7,811,866 $0 $620,384 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $146,314,016 in Education Stabilization Funds (ESF) to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for ESF grants, we selected 60 out of 460 FFATA reports for testing and noted the following: Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 60 0 56 5 32 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $155,941,257 $0 $142,016,966 $7,869,109 $76,269,656 During the year ended June 30, 2023, we noted the New Hampshire Department of Education (the Department) passed through $9,809,023 in Supporting Effective Instruction State Grant (Title IIA) funds to subrecipients (Local Educational Agencies). During our testwork over FFATA reporting at the Department for Title IIA, we selected 20 out of 74 FFATA reports for testing and noted the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 20 0 9 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $5,064,865 $0 $2,754,111 $0 $0 Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the reconciliation control not being at a precision level to ensure completeness and accuracy of the filed key elements. Additionally, effective controls were not in place to ensure timely reporting. Effect The effect of the condition found is that the Department did not comply with the Transparency Act reporting requirements. Questioned Costs None. Recommendation We recommend that the Department continue to enhance policies and procedures which include internal controls across the Department programs to which FFATA reporting is applicable, to ensure timely and accurate reporting to the FSRS system to ensure compliance with the Transparency Act reporting requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-009 NH Department of Education Special Education Cluster (Assistance Listing #84.027 and #84.173) COVID Special Education Cluster (Assistance Listing #84.027 and #84.173) Federal Award Numbers: H027A200103, H027A220103 Federal Award Year: 2020, 2022 U.S. Department of Education Compliance Requirements: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-015 Statistically Valid Sample: No Criteria LEAs and SEAs must obligate funds during the 27 months, extending from July 1 of the fiscal year for which the funds were appropriated through September 30 of the second following fiscal year. This maximum period includes a 15-month period of initial availability plus a 12-month period for carryover. For example, funds from the fiscal year 2019 appropriation initially became available on July 1, 2019; and may be obligated by the grantee and subgrantee through September 30, 2021 (Section 421(b) of GEPA (20 USC 1225(b)); 34 CFR sections 76.703 through 76.710). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 12 of 19 expenditures selected for testing awards that started during the state fiscal year, the Department had charged the expense to the new federal fiscal year grant, however, the date of service on the invoice was for a period prior to the start of that federal award. Furthermore, during our testwork over period of performance at the New Hampshire Department of Education (the Department), we noted for 6 of 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the Department had charged the expense to the old federal fiscal year grant, however, the date of service on the invoice was for a period subsequent to the end of that federal award. We also noted for 1 of the 45 expenditures selected for testing awards that ended/liquidated during the state fiscal year, the period of performance could not be confirmed for partial expenditure as the invoice provided did not include dates of service. Lastly, the Department had a breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking.   Cause The cause of the condition found is due to how the Department charges costs to federal grants and the breakdown of internal controls to ensure that expenditures are charged to the correct CAN for period of performance tracking. Effect The effect of the condition found is that the Department did not comply with the period of performance or allowability regulations. Questioned Costs $3,605 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service subsequent to the end of liquidation period for that award $5,172 - the amount of expenditures charged to the Fiscal Year 2022 award that related to a date of service prior to the start of that federal award $816 - the amount of expenditures charged to the Fiscal Year 2020 award that related to a date of service that could not be confirmed as the invoice did not include service dates Recommendation We recommend that the Department implement internal control and policies and procedures to ensure costs are appropriately charged to federal awards based on the incurred date. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-010 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Number: NUK50CK000522 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Monthly fiscal reports are required to be submitted beginning 69 days after the notice of Awards is issued Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition FFATA Reporting During our testwork over FFATA reporting, we identified the following: A. For each of the 3 FFATA reports selected for testwork, there was no evidence provided that the report was reviewed and approved prior to submission. B. For each of the 3 FFATA reports selected for testwork, we were unable to validate certain data elements that were reported. Specifically, we identified the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 3 N/A N/A 2 3 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,126,552 N/A N/A $2,212,906 $7,126,552 Monthly Reporting As part of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program, the New Hampshire Department of Health and Human Services (the Department) reports financial information to the CDC on a monthly basis related to expenditures paid out and the amount of unliquidated obligations for the reporting period. During our testwork over monthly reporting, we identified that for 2 of the 40 reports selected for testwork, while the amount of unliquidated obligations and expenditures for the month selected appeared to be reported accurately, the total cumulative expenditures reported exceeded the amount awarded. Both of reports appeared to be related to the same project. Per review of the reports, the report filed for the month of February 2023 was over reported by $7,797 and the report filed for the month of May 2023 was over reported by $19,071 Cause The cause of the condition found related to FFATA reporting is due to insufficient controls related to the review and approval of FFATA reports to ensure the accuracy of the data reported. The cause of the condition found related to monthly reporting was the result of insufficient internal controls in place to ensure that that the report was accurate. For the 2 monthly reports identified, the CDC recently switched to a quarterly reporting process. When the report was filed, the Department inadvertently reported expenditures that had been previously reported in early months and was unable to identify that the error had occurred. Effect The effect of the condition found is that the Department did not comply with the Transparency Act and the Department submitted monthly federal reports that were inaccurate. Questioned Costs None. Recommendation We recommend that the Department implement policies, procedures and internal controls to ensure the accuracy of the data reported within FSRS is complete and accurate. We recommend that the Department continue to review its existing internal controls, policies, and procedures related to monthly reporting to ensure that all required monthly financial reports are reviewed to ensure the data in the report is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-010 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Number: NUK50CK000522 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Monthly fiscal reports are required to be submitted beginning 69 days after the notice of Awards is issued Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition FFATA Reporting During our testwork over FFATA reporting, we identified the following: A. For each of the 3 FFATA reports selected for testwork, there was no evidence provided that the report was reviewed and approved prior to submission. B. For each of the 3 FFATA reports selected for testwork, we were unable to validate certain data elements that were reported. Specifically, we identified the following:   Transactions Tested Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements 3 N/A N/A 2 3 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $7,126,552 N/A N/A $2,212,906 $7,126,552 Monthly Reporting As part of the Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) program, the New Hampshire Department of Health and Human Services (the Department) reports financial information to the CDC on a monthly basis related to expenditures paid out and the amount of unliquidated obligations for the reporting period. During our testwork over monthly reporting, we identified that for 2 of the 40 reports selected for testwork, while the amount of unliquidated obligations and expenditures for the month selected appeared to be reported accurately, the total cumulative expenditures reported exceeded the amount awarded. Both of reports appeared to be related to the same project. Per review of the reports, the report filed for the month of February 2023 was over reported by $7,797 and the report filed for the month of May 2023 was over reported by $19,071 Cause The cause of the condition found related to FFATA reporting is due to insufficient controls related to the review and approval of FFATA reports to ensure the accuracy of the data reported. The cause of the condition found related to monthly reporting was the result of insufficient internal controls in place to ensure that that the report was accurate. For the 2 monthly reports identified, the CDC recently switched to a quarterly reporting process. When the report was filed, the Department inadvertently reported expenditures that had been previously reported in early months and was unable to identify that the error had occurred. Effect The effect of the condition found is that the Department did not comply with the Transparency Act and the Department submitted monthly federal reports that were inaccurate. Questioned Costs None. Recommendation We recommend that the Department implement policies, procedures and internal controls to ensure the accuracy of the data reported within FSRS is complete and accurate. We recommend that the Department continue to review its existing internal controls, policies, and procedures related to monthly reporting to ensure that all required monthly financial reports are reviewed to ensure the data in the report is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-011 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Numbers: NUK50CK000522 Federal Award Year: 2019 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-018 Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $5,070,789 of federal funding to subrecipient. As part of our testing related subrecipient monitoring, we noted the following: A. As part of our during the award monitoring testwork, we were unable to obtain documentation to support that that the Department had performed the suggested monitoring procedures for 3 of the 4 subrecipients selected for testwork based upon the subrecipients most recent risk assessment performed. For the remaining 1 subrecipient, the risk assessment form did not indicate the required frequency of the suggested type of monitoring. As a result, we were not able to verify that the Department had performed the appropriate monitoring procedures as outlined by the risk assessment performed for each subrecipient. B. The Department’s during the award monitoring for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. Per review of the risk assessment for each of the 4 subrecipients, the risk assessment did not provide for specific monitoring procedures that would address compliance with the subrecipients grant agreement beyond the period review of expenditure data. Taking into consideration that for each of the 4 subrecipients selected the testwork, if an Uniform Guidance report was issued for the subrecipient, this program was not audited as a major program, it does not appear that either the procedures suggested within the risk assessment or the procedures performed by the Department would be able to identify noncompliance incurred at the subrecipient level. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified the following: • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report. We noted however there were no findings identified within the uniform guidance report that would have required corrective action. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder As it relates to Bullet B above, for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. As it relates to Bullet C above, we were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued for 1 of 3 items selected for testwork. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. In addition, for 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report.

Finding Reference Number: 2023-011 NH Department of Health and Human Services Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) and COVID-19 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) (Assistance Listing #93.323) Federal Award Numbers: NUK50CK000522 Federal Award Year: 2019 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-018 Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $5,070,789 of federal funding to subrecipient. As part of our testing related subrecipient monitoring, we noted the following: A. As part of our during the award monitoring testwork, we were unable to obtain documentation to support that that the Department had performed the suggested monitoring procedures for 3 of the 4 subrecipients selected for testwork based upon the subrecipients most recent risk assessment performed. For the remaining 1 subrecipient, the risk assessment form did not indicate the required frequency of the suggested type of monitoring. As a result, we were not able to verify that the Department had performed the appropriate monitoring procedures as outlined by the risk assessment performed for each subrecipient. B. The Department’s during the award monitoring for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. Per review of the risk assessment for each of the 4 subrecipients, the risk assessment did not provide for specific monitoring procedures that would address compliance with the subrecipients grant agreement beyond the period review of expenditure data. Taking into consideration that for each of the 4 subrecipients selected the testwork, if an Uniform Guidance report was issued for the subrecipient, this program was not audited as a major program, it does not appear that either the procedures suggested within the risk assessment or the procedures performed by the Department would be able to identify noncompliance incurred at the subrecipient level. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified the following: • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. • For 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report. We noted however there were no findings identified within the uniform guidance report that would have required corrective action. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials: Management partially concurs with the finding above. Rejoinder As it relates to Bullet B above, for each of the 4 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. The Department did not perform any other monitoring procedures to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. We further noted that no other monitoring was performed by the Department to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. As it relates to Bullet C above, we were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued for 1 of 3 items selected for testwork. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. In addition, for 1 of 3 subrecipients selected for testwork which had a Uniform Guidance audit, the Department did not issue a management decision letter within 6 months of receipt of the report.

Finding Reference Number: 2023-012 NH Department of Health and Human Services Temporary Assistance for Needy Families and COVID-19 Temporary Assistance for Needy Families (Assistance Listing #93.558) Federal Award Numbers: 2021G996115, 2021G990228, 2022G996115 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Special Tests and Provisions: Penalty for Failure to Comply with Work Verification Plan Type of Finding: Significant Deficiency Prior Year Finding: 2022-024 Statistically Valid Sample: No The State agency must maintain adequate documentation, verification, and internal control procedures to ensure the accuracy of the data used in calculating work participation rates. In so doing, it must have in place procedures to (a) determine whether its work activities may count for participation rate purposes; (b) determine how to count and verify reported hours of work; (c) identify who is a work eligible individual; and (d) control internal data transmission and accuracy. Each State agency must comply with its HHS-approved Work Verification Plan in effect for the period that is audited. HHS may penalize the State by an amount not less than one percent and not more than five percent of the SFAG for violation of this provision (42 USC 601, 602, 607, and 609); 45 CFR sections 261.60, 261.61, 261.62, 261.63, 261.64, and 261.65). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork related to compliance with the New Hampshire Department of Health and Human Services (the Department) work verification plan we identified that for 2 of 60 participants selected for testwork, there was insufficient documentation to support the number of hours worked within the New Heights system for the participant. For the 2 participants, we identified that for 1 participant the number of hours worked appeared to be underreported and for 1 participant the number of hours appeared to be overreported. Cause The cause of the condition found was a result of inadequate review to ensure that the hours worked by each participant is accurately reported within the New Heights system. Effect The effect of the condition found is that the State may not be in compliance with its work verification plan and would not be able to identify the noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to enhance its existing internal controls and procedures to ensure that participant work hours reported agree to the documented hours worked and that the work hours are accurately reflected within the New Heights system. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-012 NH Department of Health and Human Services Temporary Assistance for Needy Families and COVID-19 Temporary Assistance for Needy Families (Assistance Listing #93.558) Federal Award Numbers: 2021G996115, 2021G990228, 2022G996115 Federal Award Year: 2021, 2022 U.S. Department of Health and Human Services Compliance Requirement: Special Tests and Provisions: Penalty for Failure to Comply with Work Verification Plan Type of Finding: Significant Deficiency Prior Year Finding: 2022-024 Statistically Valid Sample: No The State agency must maintain adequate documentation, verification, and internal control procedures to ensure the accuracy of the data used in calculating work participation rates. In so doing, it must have in place procedures to (a) determine whether its work activities may count for participation rate purposes; (b) determine how to count and verify reported hours of work; (c) identify who is a work eligible individual; and (d) control internal data transmission and accuracy. Each State agency must comply with its HHS-approved Work Verification Plan in effect for the period that is audited. HHS may penalize the State by an amount not less than one percent and not more than five percent of the SFAG for violation of this provision (42 USC 601, 602, 607, and 609); 45 CFR sections 261.60, 261.61, 261.62, 261.63, 261.64, and 261.65). Additionally, per 2 CFR section 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork related to compliance with the New Hampshire Department of Health and Human Services (the Department) work verification plan we identified that for 2 of 60 participants selected for testwork, there was insufficient documentation to support the number of hours worked within the New Heights system for the participant. For the 2 participants, we identified that for 1 participant the number of hours worked appeared to be underreported and for 1 participant the number of hours appeared to be overreported. Cause The cause of the condition found was a result of inadequate review to ensure that the hours worked by each participant is accurately reported within the New Heights system. Effect The effect of the condition found is that the State may not be in compliance with its work verification plan and would not be able to identify the noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to enhance its existing internal controls and procedures to ensure that participant work hours reported agree to the documented hours worked and that the work hours are accurately reflected within the New Heights system. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-013 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2101NHE5C6 Federal Award Year: 2021 U.S. Department of Health and Human Services Compliance Requirement: Earmarking Type of Finding: Significant Deficiency Prior Year Finding: 2022-028 Statistically Valid Sample: No Criteria Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition To ensure that the Department had met the required earmarking requirements related to administrative costs, the New Hampshire Department of Energy (the Department) maintains a tracking sheet for each federal grant that tracks all expenditures by category. At the end of the grant period, the total expenditures are reconciled to the federal grant and costs incurred related to the earmarking requirements are calculated to ensure that the required limitations are not exceeded. During our testwork over earmarking, we noted that for the 1 grant award which ended during the period under audit, the grant appeared to have met the required earmarking requirements, however we were unable to test the completeness and accuracy of the underlying support provided by management. Specifically, we were unable to reconcile the total expenditures contained within the underlying support to the final grant close out report (the SF-425) submitted for the grant. Cause The cause of the condition found is due to the Department is unable to submit a final close out report within the federal reporting portal as the portal does not contain an option to complete the required report. As a result, the last federal report filed for this grant was as of September 30, 2022, which was prior to the liquidation of all obligations under the grant. Effect The effect of the condition found is that the expenditures utilized to track compliance with the earmarking requirement may not reconcile to the final expenditures reported within the SF-425 resulting in noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to work with the federal government to ensure that all grants that are required to be closed out have a final SF-245 and that the final expenditures reported reconciles to the expenditures used to track the required earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-013 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2101NHE5C6 Federal Award Year: 2021 U.S. Department of Health and Human Services Compliance Requirement: Earmarking Type of Finding: Significant Deficiency Prior Year Finding: 2022-028 Statistically Valid Sample: No Criteria Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition To ensure that the Department had met the required earmarking requirements related to administrative costs, the New Hampshire Department of Energy (the Department) maintains a tracking sheet for each federal grant that tracks all expenditures by category. At the end of the grant period, the total expenditures are reconciled to the federal grant and costs incurred related to the earmarking requirements are calculated to ensure that the required limitations are not exceeded. During our testwork over earmarking, we noted that for the 1 grant award which ended during the period under audit, the grant appeared to have met the required earmarking requirements, however we were unable to test the completeness and accuracy of the underlying support provided by management. Specifically, we were unable to reconcile the total expenditures contained within the underlying support to the final grant close out report (the SF-425) submitted for the grant. Cause The cause of the condition found is due to the Department is unable to submit a final close out report within the federal reporting portal as the portal does not contain an option to complete the required report. As a result, the last federal report filed for this grant was as of September 30, 2022, which was prior to the liquidation of all obligations under the grant. Effect The effect of the condition found is that the expenditures utilized to track compliance with the earmarking requirement may not reconcile to the final expenditures reported within the SF-425 resulting in noncompliance. Questioned Costs Not determinable. Recommendation We recommend that the Department continue to work with the federal government to ensure that all grants that are required to be closed out have a final SF-245 and that the final expenditures reported reconciles to the expenditures used to track the required earmarking requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-014 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance. (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Cash Management Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-027 Statistically Valid Sample: No Criteria U.S. Department of the Treasury (Treasury) regulations at 31 CFR 204 part 205 implement the Cash Management Act of 1990 (CMIA). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Catalog of Federal Domestic assistance that meet the funding threshold for a major federal program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Pass-through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient (2 CFR section 200.305(b)(1)). Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over performed over cash management related to the Low-Income Home Energy Assistance program, we noted the following: A. Under the State of New Hampshire’s Cash Management Agreement (CMIA), direct expenditures are to be drawn using the actual draw – monthly technique. Under this technique, the funds are to be requested monthly based on actual costs incurred during that 1-month period. The funding technique is interest neutral. During our testwork over the cash draw process, we noted the following: a. For 4 of 9 cash draws selected for testwork, the New Hampshire Department of Energy (the Department) did not draw funds timely resulting in the cash draw to be delinquent. Each of the 4 cash draw covered multiple months of activity. As the clearance pattern within the CMIA agreement is interest neutral, there was no interest impact because of the cash draws not being performed timely. B. The Department advances payments to subrecipients to ensure that they have sufficient cash on hand to pay for benefit payments. The Department passed through $52,485,098 to subrecipients during the year ended June 30, 2023. During our testwork over compliance with cash management, we noted that for the 4 cash advance payment samples selected for testwork, the Department was not able to provide sufficient evidence to support that the cash advance was spent within a time period that minimizes the time elapsed between the transfer of federal funds to the subrecipient and their disbursement for program purposes. The Department’s normal disbursement cycle of every 30 days. As such, it does not appear that the Department sufficiently minimized the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes. Cause The cause of the condition found was primarily due to insufficient resources to monitor and track cash draws to ensure they are performed timely in accordance with the clearance patten established within the CMIA agreement and to ensure that subrecipients either utilize advance funds timely or effectively evaluate the amount of funds they need on hand at the time of the advance payment. Effect The effect of the condition found is that the Department did not comply with the provisions of the CMIA as it relates to the timing of cash draws. In addition, the Department did not have sufficient policies and procedures in place to ensure the time elapsed between the transfer of federal funds to the subrecipient and their disbursement of funds for program purposes is minimized. As such the Department was not in compliance with 2 CFR section 200.305(b)(1). Questioned Costs None. Recommendation We recommend that the Department review its existing internal controls, policies, and procedures to ensure that all cash draws are performed timely and in accordance with the CMIA agreement. In addition, we recommend that the Department review its existing internal controls, policies and procedures relating to advancing funds to subrecipients to ensure that excess cash held by the subrecipients does not exceed 30 days. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-014 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance. (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Cash Management Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-027 Statistically Valid Sample: No Criteria U.S. Department of the Treasury (Treasury) regulations at 31 CFR 204 part 205 implement the Cash Management Act of 1990 (CMIA). Subpart A of those regulations requires state recipients to enter into Treasury-State Agreements that prescribe specific methods of drawing down federal funds (funding techniques) for federal programs listed in the Catalog of Federal Domestic assistance that meet the funding threshold for a major federal program under the CMIA. Treasury-State Agreements also specify the terms and conditions under which an interest liability would be incurred. Pass-through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient (2 CFR section 200.305(b)(1)). Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over performed over cash management related to the Low-Income Home Energy Assistance program, we noted the following: A. Under the State of New Hampshire’s Cash Management Agreement (CMIA), direct expenditures are to be drawn using the actual draw – monthly technique. Under this technique, the funds are to be requested monthly based on actual costs incurred during that 1-month period. The funding technique is interest neutral. During our testwork over the cash draw process, we noted the following: a. For 4 of 9 cash draws selected for testwork, the New Hampshire Department of Energy (the Department) did not draw funds timely resulting in the cash draw to be delinquent. Each of the 4 cash draw covered multiple months of activity. As the clearance pattern within the CMIA agreement is interest neutral, there was no interest impact because of the cash draws not being performed timely. B. The Department advances payments to subrecipients to ensure that they have sufficient cash on hand to pay for benefit payments. The Department passed through $52,485,098 to subrecipients during the year ended June 30, 2023. During our testwork over compliance with cash management, we noted that for the 4 cash advance payment samples selected for testwork, the Department was not able to provide sufficient evidence to support that the cash advance was spent within a time period that minimizes the time elapsed between the transfer of federal funds to the subrecipient and their disbursement for program purposes. The Department’s normal disbursement cycle of every 30 days. As such, it does not appear that the Department sufficiently minimized the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes. Cause The cause of the condition found was primarily due to insufficient resources to monitor and track cash draws to ensure they are performed timely in accordance with the clearance patten established within the CMIA agreement and to ensure that subrecipients either utilize advance funds timely or effectively evaluate the amount of funds they need on hand at the time of the advance payment. Effect The effect of the condition found is that the Department did not comply with the provisions of the CMIA as it relates to the timing of cash draws. In addition, the Department did not have sufficient policies and procedures in place to ensure the time elapsed between the transfer of federal funds to the subrecipient and their disbursement of funds for program purposes is minimized. As such the Department was not in compliance with 2 CFR section 200.305(b)(1). Questioned Costs None. Recommendation We recommend that the Department review its existing internal controls, policies, and procedures to ensure that all cash draws are performed timely and in accordance with the CMIA agreement. In addition, we recommend that the Department review its existing internal controls, policies and procedures relating to advancing funds to subrecipients to ensure that excess cash held by the subrecipients does not exceed 30 days. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-015 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-025 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required through the terms and conditions of the award, subaward monitoring must include following up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means; and 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Low-Income Home Energy Assistance program (LIHEAP), the New Hampshire Department of Energy (the Department) enters into grant agreements with local entities to provide services related to the eligibility determination process for the LIHEAP program (including the calculation of participant benefits) and payment of benefits to fuel providers. During the year ended June 30, 2023, $52,485,098 was passed through to subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following as of the year ending June 30, 2023: A. The Department communicates award information to subrecipients through the approved grant agreement. Per review of the grant agreement, for each of the 3 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Federal Award Identification Number (FAIN) b. Federal award date c. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) d. Identification of whether the award is R&D B. For the 1 programmatic monitoring review completed by the Department during the period under audit, the Department did not issue its programmatic monitoring report to the subrecipient timely after the monitoring review was completed. As a result, there was a delay in the subrecipient implementing its corrective action plan to address the findings identified during the programmatic monitoring review. Specifically, we noted the following: a. For the 1 programmatic monitoring review, the monitoring review took place on May 4, 2023, but the report to the subrecipient was not issued until September 23, 2023. Per review of the report that was issued, there were findings identified by the Department that warranted corrective action. Due to the delay in issuing the report, a corrective action plan was not obtained from the subrecipient until almost 5 months after the date of that the monitoring review took place. C. For 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted the following: a. The Department does not track the receipt of uniform guidance reports. As a result, we were unable to determine when the uniform guidance reports were received by the Department to ensure they are reviewed timely. Specifically, we noted: i. For all 3 subrecipients selected, the subrecipient’s uniform guidance appeared to have been reviewed, but as the Department does not track the receipt of uniform guidance reports, it was unclear if it was reviewed timely. We did note based on the date that the uniform guidance report was issued, the management decision letter was not issued within 6 months of the date of the report being issued as required by 2 CRF 200.521 (d). ii. For 1 subrecipient in which the UG report had a finding, we were unable to obtain evidence to support that the Department had obtained and reviewed the subrecipient’s uniform guidance report, including management’s response to findings letter as well as the related Corrective Action Plan, as this subrecipient’s uniform guidance report noted a material weakness. E. The Annual Report on Households Assisted by LIHEAP contains data that is specific to benefits paid to eligible participants. The data that is used to compile the annual report is obtained from case data that is reported to the New Hampshire Department of Energy (the Department) from its subrecipients as the Department has entered into grant agreements with third parties who are responsible for the eligibility determination and benefit payment process. As part of our subrecipient monitoring testwork, we were unable to verify that the Department had performed any monitoring procedures over the data provided by each subrecipient to ensure that the data reported within the annual report was complete and accurate. Cause The cause of the condition found was primarily due to insufficient documented subrecipient policies and procedures to ensure that adequate monitoring is performed over subrecipients to align with the risk assessments performed. The monitoring procedures that are in place do not include the completeness and accuracy of the data submitted by the subrecipient utilized to compile federal reports. Further, the Department does not have sufficient internal controls and procedures to ensure results of monitoring visits are performed and results communicated timely to subrecipient or to ensure that subrecipient uniform guidance reports are obtained and reviewed timely. In addition, there are insufficient internal controls in place to review the grant agreements to ensure that all required data elements are communicated to the subrecipient in accordance with 2 CFR section 300.332(b). Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), section 200.332(b) and 2 CFR section 200.521. Questioned Costs None. Recommendation We recommend that the Department formalize, policies and procedures and implement the necessary internal controls to ensure that the Department complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(b) and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. As a result of the risk assessment performed, monitoring activities are performed over subrecipients to ensure compliance with the terms and conditions of its subrecipient grant agreement. The results of all monitoring reviews should be timely communicated in accordance with the Department’s policies to the subrecipient and actions requiring corrective action plan should be followed up on to ensure that the matter is resolved; and 3. Ensure that all uniform guidance reports are collected and reviewed timely so that a management decision letter can be issued within the time period required by federal regulations. Retain evidence of Department review of uniform guidance reports and management letters issued as a result of their review. View of Responsible Officials: Management partially concurs with the finding above Rejoinder As it relates to Bullet C above, for 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy

Finding Reference Number: 2023-015 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI Federal Award Year: 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-025 Statistically Valid Sample: No Criteria A pass-through entity must: 1. Clearly identify to the subrecipient required award information and applicable requirements described in 2 CFR section 200.332(a); 2. Evaluate each subrecipient’s risk of noncompliance for the purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 300.332(b)); 3. Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required through the terms and conditions of the award, subaward monitoring must include following up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means; and 4. Issuing a management decision for audit findings pertaining to federal award provided to the subrecipient from the subrecipient as required by 2 CFR section 200.521. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition As part of the Low-Income Home Energy Assistance program (LIHEAP), the New Hampshire Department of Energy (the Department) enters into grant agreements with local entities to provide services related to the eligibility determination process for the LIHEAP program (including the calculation of participant benefits) and payment of benefits to fuel providers. During the year ended June 30, 2023, $52,485,098 was passed through to subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following as of the year ending June 30, 2023: A. The Department communicates award information to subrecipients through the approved grant agreement. Per review of the grant agreement, for each of the 3 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332. Specifically, the following elements were not communicated: a. Federal Award Identification Number (FAIN) b. Federal award date c. Indirect cost rate for federal awards (including if the deminimus rate is charged per 2 CFR section 200.414) d. Identification of whether the award is R&D B. For the 1 programmatic monitoring review completed by the Department during the period under audit, the Department did not issue its programmatic monitoring report to the subrecipient timely after the monitoring review was completed. As a result, there was a delay in the subrecipient implementing its corrective action plan to address the findings identified during the programmatic monitoring review. Specifically, we noted the following: a. For the 1 programmatic monitoring review, the monitoring review took place on May 4, 2023, but the report to the subrecipient was not issued until September 23, 2023. Per review of the report that was issued, there were findings identified by the Department that warranted corrective action. Due to the delay in issuing the report, a corrective action plan was not obtained from the subrecipient until almost 5 months after the date of that the monitoring review took place. C. For 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted the following: a. The Department does not track the receipt of uniform guidance reports. As a result, we were unable to determine when the uniform guidance reports were received by the Department to ensure they are reviewed timely. Specifically, we noted: i. For all 3 subrecipients selected, the subrecipient’s uniform guidance appeared to have been reviewed, but as the Department does not track the receipt of uniform guidance reports, it was unclear if it was reviewed timely. We did note based on the date that the uniform guidance report was issued, the management decision letter was not issued within 6 months of the date of the report being issued as required by 2 CRF 200.521 (d). ii. For 1 subrecipient in which the UG report had a finding, we were unable to obtain evidence to support that the Department had obtained and reviewed the subrecipient’s uniform guidance report, including management’s response to findings letter as well as the related Corrective Action Plan, as this subrecipient’s uniform guidance report noted a material weakness. E. The Annual Report on Households Assisted by LIHEAP contains data that is specific to benefits paid to eligible participants. The data that is used to compile the annual report is obtained from case data that is reported to the New Hampshire Department of Energy (the Department) from its subrecipients as the Department has entered into grant agreements with third parties who are responsible for the eligibility determination and benefit payment process. As part of our subrecipient monitoring testwork, we were unable to verify that the Department had performed any monitoring procedures over the data provided by each subrecipient to ensure that the data reported within the annual report was complete and accurate. Cause The cause of the condition found was primarily due to insufficient documented subrecipient policies and procedures to ensure that adequate monitoring is performed over subrecipients to align with the risk assessments performed. The monitoring procedures that are in place do not include the completeness and accuracy of the data submitted by the subrecipient utilized to compile federal reports. Further, the Department does not have sufficient internal controls and procedures to ensure results of monitoring visits are performed and results communicated timely to subrecipient or to ensure that subrecipient uniform guidance reports are obtained and reviewed timely. In addition, there are insufficient internal controls in place to review the grant agreements to ensure that all required data elements are communicated to the subrecipient in accordance with 2 CFR section 300.332(b). Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(a), section 200.332(b) and 2 CFR section 200.521. Questioned Costs None. Recommendation We recommend that the Department formalize, policies and procedures and implement the necessary internal controls to ensure that the Department complies with the provisions of 2 CFR section 200.332(a), 2 CFR section 200.332(b) and 2 CFR section 200.251. This would include ensuring that: 1. All required award information is communicated to subrecipients; 2. As a result of the risk assessment performed, monitoring activities are performed over subrecipients to ensure compliance with the terms and conditions of its subrecipient grant agreement. The results of all monitoring reviews should be timely communicated in accordance with the Department’s policies to the subrecipient and actions requiring corrective action plan should be followed up on to ensure that the matter is resolved; and 3. Ensure that all uniform guidance reports are collected and reviewed timely so that a management decision letter can be issued within the time period required by federal regulations. Retain evidence of Department review of uniform guidance reports and management letters issued as a result of their review. View of Responsible Officials: Management partially concurs with the finding above Rejoinder As it relates to Bullet C above, for 3 of 3 subrecipients selected for testwork, the Department did not complete its annual fiscal monitoring review during the audit period as required by their monitoring policy

Finding Reference Number: 2023-016 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI, 1700NHLIEA Federal Award Year: 2017, 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-026 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The Low-Income Home Energy Assistance program (LIHEAP), Performance Data Form (OMB No. 0970-0449) must be submitted before January 31st regarding the prior federal fiscal year. The first section of the report is the Grant recipient Survey that collects and reports data on sources and uses of LIHEAP funds. The Grant recipient Survey includes Section III: Estimated Sources of Funds and Section IV: Estimated Use of LIHEAP Funds. Note: that these are referencing obligated not expended funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service. The Grantee Survey obligation amounts should be compared with the Carryover and Reallotment and FFR-425 reports. This reconciliation is needed to make sure the obligated balances for the program year being tested are accurate. LIHEAP Carryover and Reallotment Report (OMB No. 0970-0106) – Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported (42 USC 8626). Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) https://omb.report/icr/202211-0970-005 – As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Native American tribes are required to report only on the number of households served for each program component (42 USC 8629; 45 CFR section 96.82). Quarterly Performance and Management Report (OMB No. 0970-0589) https://omb.report/icr/202205-0970-017/doc/121847100 – Grant recipients must submit data and information about LIHEAP during the current FY, including success, challenges, needs and innovations. The quarterly reports focus on assisted households, performance management, obligation of funding, changes made due to anticipated increase in energy bills, collaboration with other utility programs, and training and technical assistance needs. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the Low-Income Home Energy Assistance program (LIHEAP), we noted the following: A. The New Hampshire Department of Energy (the Department) during the year ended June 30, 2023, $52,485,098 was passed through to subrecipients that met the requirements for first tier subawards under the Transparency Act and as such FFATA reports were required to be filed for each of those subawards. During our testwork over FFATA reporting at the Department of Energy, we selected 4 out of 7 FFATA reports for testing and noted the following: Reports Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 4 0 1 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $13,825,743 $0 $1,115,000 $0 $0 B. The annual LIHEAP Performance Data Form was not submitted by January 31, 2023. The Department submitted the report in December 2023. The Department was unable to provide sufficient underlying support for the Key Line items associated with the report including the following: Uses of Funds, the total Uses of Funds should equal the total Sources of Funds, and Other LIHEAP assistance. The Department was unable to provide a reconciliation between the LIHEAP Performance Data Form Grantee Survey obligation amounts reported to the Carryover and Reallotment and FFR-425 reports. C. The Department did not submit its required special reports (i.e. Quarterly Performance and Management Reports, Annual Report of Assisted Households Report, and LIHEAP Carryover and Reallotment Report) in a timely manner. There were also no procedures implemented to ensure that the submission of Special Reports includes accurate and complete data. Specifically, we noted the following: LIHEAP Carryover and Reallotment Report - This report must be submitted no later than August 1 for the federal fiscal year. This report was not submitted in a timely manner for the period ending 9/30/2022, as it was submitted on 8/9/2023 with an original due date of 8/1/2022. This report was not submitted in a timely manner for the period ending 9/30/2023, as it was not yet submitted as of March 12, 2024, with an original due date of 8/1/2023. The administrative expenditures balance utilized to calculate the PY22 Carryover balance submitted in the PY22 Carryover and Reallotment Report was an estimate, even though there was actual data for this balance since the report was submitted a year late. The actual balance per the support provided by the Dept. of Energy was $14,488.95, which is $20,337.05 less than the balance estimated. Annual Report on Households Assisted by LIHEAP - There is not a designated due date for this report. However, as this report is due at the end of every federal fiscal year, this should be submitted within a reasonable time after the end of the federal fiscal year (9/30) for the data to be reported in a timely manner to the Federal Government. The report for the year ending 9/30/2022 was submitted on 9/25/2023, which is almost an entire year after the end of the federal fiscal year, and the report for the year ending 9/30/2023 wasn't submitted until 1/23/2024, which is almost four months after federal fiscal year end. Additionally, some of the data submitted within the 9/30/2022 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted: In Section 1, line item 10. Weatherization the amount reported was 249 households and the amount per the underlying support was 7,262 households. In Section 2, line item 10. Weatherization the amounts reported for the various poverty levels was inaccurate per the underlying support, as shown in the below table. Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 10. Weatherization 33 38 43 38 97 Per Support: 2 Weatherization 1,013 1,122 1,123 1,163 2,841 Furthermore, all the data submitted within the 9/30/2023 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted for Sections 1 and 2 below: Section Data Field Amount per Report Amount per Support 1 1. Heating 29,642 31,289 e. Winter 1,680 1,730 10. Weatherization 199 9,875 14. Any type of LIHEAP assistance 29,669 31,289 18. Bill Payment Assistance 29,642 31,289 Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 1. Heating 3,190 3,238 3,519 3,710 15,985 e. Winter 332 172 164 182 830 10. Weatherization 10 22 26 19 122 Per Support: 2 Heating 4,040 4,074 4,432 4,329 14,414 Winter/Year Round Crisis 395 216 200 212 707 Weatherization 1,134 1,202 1,312 1,354 4,873 Quarterly Performance and Management Report - There is not a designated due date within for this report. However, as this report is due every quarter, this report should be submitted within the subsequent quarter for the data to be reported in a timely manner to the Federal Government. For 1 of the 3 quarterly reports submitted, we were unable to determine when it was submitted, as the report was not signed and dated by the Program Director when submitted. Additionally, for the Quarterly Performance and Management report submitted for the quarter ended 6/30/2022, we noted 2 key line items that were inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2022 was reported as 24,405 and the amount per the underlying support was 24,425, as well as the LIHEAP fiscal year end 2022 non-Supplemental (released November 1, 2021) amount of funds obligated was reported as $24,114,530 and the amount per the underlying support was $30,948,915. Additionally, we noted 7 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: total cumulative assisted households, total cumulative assisted households during the same period last year, total households for quarter 3 assisted during the same period last year, number of occurrences of households where LIHEAP prevented the loss of home energy for quarter 3, number of occurrences of households where LIHEAP restored home energy for quarter 3, total amount of funds obligated for ARPA 2021, amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 12/31/2022, we noted 3 key line items that were unable to be verified as complete and accurate as no underlying support could be provided by the Department. Those key line items are as follows: number of assisted households during the same period last year for quarter 1 federal fiscal year 2023, total amount of funds obligated for LIHEAP fiscal year 2023 allotment B, and amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 6/30/2023, we noted 1 key line item that was inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2023 was reported as 3,232 and the amount per the underlying support was 3,367. Additionally, we noted 2 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: amount of funds obligated for LIHEAP federal fiscal year 2023 allotment and amount of funds obligated for other supplemental allotment. Cause The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal FFATA reports were filed timely. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal performance reports were filed or filed timely as well as insufficient policies and procedures to ensure that the documentation to support the key line items reported on the LIHEAP Performance Data Form were retained. Additionally, the Department has insufficient policies and procedures to ensure that the required reconciliation between reported Performance Data Form Grantee Survey obligation amounts and Carryover and Reallotment report as well as FFR-425 reports is completed. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal special reports were filed or filed timely. Also, the Department had the Federal Government contract out a federal consulting firm, APRISE, to help the Department submit the required special reports and the federal consulting firm was not able to provide the Department with support for the data that was submitted within these reports. Effect The effect of the condition found is that the Department did not file required FFATA reports, LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP in a timely manner. The effect of the condition is also that the Department did not file complete and accurate performance and special federal reports. Questioned Costs None. Recommendation We recommend that the Department should review to ensure there is sufficient safeguards in place for professionals to perform when positions are vacant so that necessary processes are completed related to compliance with federal requirements, including federal reporting requirements related to the timely submission of the annual LIHEAP Performance Report, the annual LIHEAP Carryover and Reallotment Report, the Quarterly Performance and Management Report and the Annual Report on Households Assisted by LIHEAP as well as the submission of FFATA reports for first-tier subawards. In addition, we recommend that the Department implement written policies and procedures for the compilation and review of the LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP and ensure that the documentation to support the amounts reported is maintained to support that the report is complete and accurate. View of Responsible Official: Management concurs with the finding above.

Finding Reference Number: 2023-016 NH Department of Energy Low Income Home Energy Assistance and COVID-19 Low Income Home Energy Assistance (Assistance Listing #93.568) Federal Award Numbers: 2001NHLEA, 2001NHLIE4, 2001NH5C3, 2101NHLIEA, 2101NHE5C6, 2201NHLIEA, 2101NHLIE4, 2201NHLIEE, 2201NHLIEI, 2301NHLIEA, 2301NHLIEE, 2301NHLIEI, 1700NHLIEA Federal Award Year: 2017, 2020, 2021, 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-026 Statistically Valid Sample: No Criteria Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The Low-Income Home Energy Assistance program (LIHEAP), Performance Data Form (OMB No. 0970-0449) must be submitted before January 31st regarding the prior federal fiscal year. The first section of the report is the Grant recipient Survey that collects and reports data on sources and uses of LIHEAP funds. The Grant recipient Survey includes Section III: Estimated Sources of Funds and Section IV: Estimated Use of LIHEAP Funds. Note: that these are referencing obligated not expended funding. The rest of the report is regarding performance metrics, mostly related to home energy burden targeting and reduction, as well as the continuity of home energy service. The Grantee Survey obligation amounts should be compared with the Carryover and Reallotment and FFR-425 reports. This reconciliation is needed to make sure the obligated balances for the program year being tested are accurate. LIHEAP Carryover and Reallotment Report (OMB No. 0970-0106) – Grantees must submit this report no later than August 1 indicating the amount expected to be carried forward for obligation in the following fiscal year and the planned use of those funds. Funds in excess of the maximum carryover limit are subject to reallotment to other LIHEAP grantees in the following fiscal year and must also be reported (42 USC 8626). Annual Report on Households Assisted by LIHEAP (OMB No. 0970-0060) https://omb.report/icr/202211-0970-005 – As part of the application for block grant funds each year, a report is required for the preceding fiscal year of (1) the number and income levels of the households assisted for each component and any type of LHEAP assistance (heating, cooling, crisis, and weatherization); and (2) the number of households served that contained young children, elderly, or persons with disabilities, or any vulnerable household for each component. Territories with annual allotments of less than $200,000 and all Native American tribes are required to report only on the number of households served for each program component (42 USC 8629; 45 CFR section 96.82). Quarterly Performance and Management Report (OMB No. 0970-0589) https://omb.report/icr/202205-0970-017/doc/121847100 – Grant recipients must submit data and information about LIHEAP during the current FY, including success, challenges, needs and innovations. The quarterly reports focus on assisted households, performance management, obligation of funding, changes made due to anticipated increase in energy bills, collaboration with other utility programs, and training and technical assistance needs. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the Low-Income Home Energy Assistance program (LIHEAP), we noted the following: A. The New Hampshire Department of Energy (the Department) during the year ended June 30, 2023, $52,485,098 was passed through to subrecipients that met the requirements for first tier subawards under the Transparency Act and as such FFATA reports were required to be filed for each of those subawards. During our testwork over FFATA reporting at the Department of Energy, we selected 4 out of 7 FFATA reports for testing and noted the following: Reports Tested Subaward not reported Report not timely Subaward amount incorrect Subaward incorrect key elements 4 0 1 0 0 Dollar Amount of Tested Transactions Subaward not reported Report not timely Subaward amount incorrect Subaward missing key elements $13,825,743 $0 $1,115,000 $0 $0 B. The annual LIHEAP Performance Data Form was not submitted by January 31, 2023. The Department submitted the report in December 2023. The Department was unable to provide sufficient underlying support for the Key Line items associated with the report including the following: Uses of Funds, the total Uses of Funds should equal the total Sources of Funds, and Other LIHEAP assistance. The Department was unable to provide a reconciliation between the LIHEAP Performance Data Form Grantee Survey obligation amounts reported to the Carryover and Reallotment and FFR-425 reports. C. The Department did not submit its required special reports (i.e. Quarterly Performance and Management Reports, Annual Report of Assisted Households Report, and LIHEAP Carryover and Reallotment Report) in a timely manner. There were also no procedures implemented to ensure that the submission of Special Reports includes accurate and complete data. Specifically, we noted the following: LIHEAP Carryover and Reallotment Report - This report must be submitted no later than August 1 for the federal fiscal year. This report was not submitted in a timely manner for the period ending 9/30/2022, as it was submitted on 8/9/2023 with an original due date of 8/1/2022. This report was not submitted in a timely manner for the period ending 9/30/2023, as it was not yet submitted as of March 12, 2024, with an original due date of 8/1/2023. The administrative expenditures balance utilized to calculate the PY22 Carryover balance submitted in the PY22 Carryover and Reallotment Report was an estimate, even though there was actual data for this balance since the report was submitted a year late. The actual balance per the support provided by the Dept. of Energy was $14,488.95, which is $20,337.05 less than the balance estimated. Annual Report on Households Assisted by LIHEAP - There is not a designated due date for this report. However, as this report is due at the end of every federal fiscal year, this should be submitted within a reasonable time after the end of the federal fiscal year (9/30) for the data to be reported in a timely manner to the Federal Government. The report for the year ending 9/30/2022 was submitted on 9/25/2023, which is almost an entire year after the end of the federal fiscal year, and the report for the year ending 9/30/2023 wasn't submitted until 1/23/2024, which is almost four months after federal fiscal year end. Additionally, some of the data submitted within the 9/30/2022 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted: In Section 1, line item 10. Weatherization the amount reported was 249 households and the amount per the underlying support was 7,262 households. In Section 2, line item 10. Weatherization the amounts reported for the various poverty levels was inaccurate per the underlying support, as shown in the below table. Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 10. Weatherization 33 38 43 38 97 Per Support: 2 Weatherization 1,013 1,122 1,123 1,163 2,841 Furthermore, all the data submitted within the 9/30/2023 report is deemed to not be complete and accurate based on the underlying support provided. Specifically, the following was noted for Sections 1 and 2 below: Section Data Field Amount per Report Amount per Support 1 1. Heating 29,642 31,289 e. Winter 1,680 1,730 10. Weatherization 199 9,875 14. Any type of LIHEAP assistance 29,669 31,289 18. Bill Payment Assistance 29,642 31,289 Section Type of LIHEAP assistance A. Under 75% poverty B. 75%- 100% poverty C. 101%- 125% poverty D. 126%- 150% poverty E. Over 150% poverty Per Report: 2 1. Heating 3,190 3,238 3,519 3,710 15,985 e. Winter 332 172 164 182 830 10. Weatherization 10 22 26 19 122 Per Support: 2 Heating 4,040 4,074 4,432 4,329 14,414 Winter/Year Round Crisis 395 216 200 212 707 Weatherization 1,134 1,202 1,312 1,354 4,873 Quarterly Performance and Management Report - There is not a designated due date within for this report. However, as this report is due every quarter, this report should be submitted within the subsequent quarter for the data to be reported in a timely manner to the Federal Government. For 1 of the 3 quarterly reports submitted, we were unable to determine when it was submitted, as the report was not signed and dated by the Program Director when submitted. Additionally, for the Quarterly Performance and Management report submitted for the quarter ended 6/30/2022, we noted 2 key line items that were inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2022 was reported as 24,405 and the amount per the underlying support was 24,425, as well as the LIHEAP fiscal year end 2022 non-Supplemental (released November 1, 2021) amount of funds obligated was reported as $24,114,530 and the amount per the underlying support was $30,948,915. Additionally, we noted 7 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: total cumulative assisted households, total cumulative assisted households during the same period last year, total households for quarter 3 assisted during the same period last year, number of occurrences of households where LIHEAP prevented the loss of home energy for quarter 3, number of occurrences of households where LIHEAP restored home energy for quarter 3, total amount of funds obligated for ARPA 2021, amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 12/31/2022, we noted 3 key line items that were unable to be verified as complete and accurate as no underlying support could be provided by the Department. Those key line items are as follows: number of assisted households during the same period last year for quarter 1 federal fiscal year 2023, total amount of funds obligated for LIHEAP fiscal year 2023 allotment B, and amount of funds obligated for other supplemental allotment. For the Quarterly Performance and Management report submitted for the quarter ended 6/30/2023, we noted 1 key line item that was inaccurate based upon the underlying support. Specifically, the total number of assisted households for quarter 3 federal fiscal year 2023 was reported as 3,232 and the amount per the underlying support was 3,367. Additionally, we noted 2 key line items that were unable to be verified as complete and accurate as no underlying support could be provided. Those key line items are as follows: amount of funds obligated for LIHEAP federal fiscal year 2023 allotment and amount of funds obligated for other supplemental allotment. Cause The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal FFATA reports were filed timely. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal performance reports were filed or filed timely as well as insufficient policies and procedures to ensure that the documentation to support the key line items reported on the LIHEAP Performance Data Form were retained. Additionally, the Department has insufficient policies and procedures to ensure that the required reconciliation between reported Performance Data Form Grantee Survey obligation amounts and Carryover and Reallotment report as well as FFR-425 reports is completed. The cause of the condition found was primarily due to insufficient resources within the Department to ensure the federal special reports were filed or filed timely. Also, the Department had the Federal Government contract out a federal consulting firm, APRISE, to help the Department submit the required special reports and the federal consulting firm was not able to provide the Department with support for the data that was submitted within these reports. Effect The effect of the condition found is that the Department did not file required FFATA reports, LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP in a timely manner. The effect of the condition is also that the Department did not file complete and accurate performance and special federal reports. Questioned Costs None. Recommendation We recommend that the Department should review to ensure there is sufficient safeguards in place for professionals to perform when positions are vacant so that necessary processes are completed related to compliance with federal requirements, including federal reporting requirements related to the timely submission of the annual LIHEAP Performance Report, the annual LIHEAP Carryover and Reallotment Report, the Quarterly Performance and Management Report and the Annual Report on Households Assisted by LIHEAP as well as the submission of FFATA reports for first-tier subawards. In addition, we recommend that the Department implement written policies and procedures for the compilation and review of the LIHEAP Performance Data Form, LIHEAP Carryover and Reallotment Report, Quarterly Performance and Management Report and Annual Report on Households Assisted by LIHEAP and ensure that the documentation to support the amounts reported is maintained to support that the report is complete and accurate. View of Responsible Official: Management concurs with the finding above.

Finding Reference Number: 2023-017 NH Department of Health and Human Services Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) and COVID-19 Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) Federal Award Numbers: 1B08Ti084659-01, 1B08TI085821-01 Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $7,720,172 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. The Department provided the most recent risk assessment performed for each of the 7 subrecipients selected for testwork. Per review of the risk assessments provided, we identified the following: 1. For 5 of the subrecipients, the risk assessment indicated that the subrecipients expenditure detail should be examined monthly to ensure compliance with contract requirements and applicable laws and rules. We were unable to determine if this procedure had been performed as part of the Department’s subrecipient monitoring process. 2. For the remaining 2 subrecipients the recommended monitoring procedures was left blank on the risk assessment and as such we are unable to verify what type of monitoring procedures should have been performed. B. The Department’s during the award monitoring for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified that for 2 of 7 subrecipients selected for testwork, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department review its existing policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials Management partially concurs with the finding above. Rejoinder As it relates to Bullet A above, we were not able to obtain documentation to support that the suggested procedures outlined within the risk assessment was performed. As it relates to Bullet B above, for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement.

Finding Reference Number: 2023-017 NH Department of Health and Human Services Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) and COVID-19 Substance Abuse Prevention and Treatment Block Grant (ALN #93.959) Federal Award Numbers: 1B08Ti084659-01, 1B08TI085821-01 Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 2. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award Condition During the year ended June 30, 2023, the New Hampshire Department of Health and Human Services (the Department) passed through $7,720,172 of federal funding to subrecipients. As part of our testing related subrecipient monitoring, we identified the following: A. The Department provided the most recent risk assessment performed for each of the 7 subrecipients selected for testwork. Per review of the risk assessments provided, we identified the following: 1. For 5 of the subrecipients, the risk assessment indicated that the subrecipients expenditure detail should be examined monthly to ensure compliance with contract requirements and applicable laws and rules. We were unable to determine if this procedure had been performed as part of the Department’s subrecipient monitoring process. 2. For the remaining 2 subrecipients the recommended monitoring procedures was left blank on the risk assessment and as such we are unable to verify what type of monitoring procedures should have been performed. B. The Department’s during the award monitoring for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement. C. During our review over the Department’s review over the subrecipients Uniform Guidance reports, we identified that for 2 of 7 subrecipients selected for testwork, the subrecipients uniform guidance audit was not issued within 9 months of the subrecipients year end. We were unable to obtain any correspondence between the Department or the subrecipient to inquire about the uniform guidance report or when it would be issued. Upon receipt of the report, the Department did issue a management decision letter upon receipt of the report. Cause The cause of the condition found was primarily due to a lack of formal policies and internal controls to ensure that all required subrecipient monitoring compliance procedures are being performed by the Department. Effect The effect of the condition found is that the Department did not comply with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). Questioned Costs None. Recommendation We recommend the Department review its existing policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(b), 2 CFR sections 200.332(d) through (f), and 2 CFR section 200.501(h). This would ensure that the risk assessment is routinely updated for multiyear grants and that the prescribed monitoring procedures take into consideration any additional monitoring procedures that might need to be performed, such as a desk review or on-site visit, if the program is not audited as part of the subrecipient’s uniform guidance audit. In addition, policies and procedures should be established to ensure that if the risk assessment has suggested a particular monitoring procedure be performed, that the Department is adequately documenting its monitoring procedures to ensure that it has performed the required procedures. View of Responsible Officials Management partially concurs with the finding above. Rejoinder As it relates to Bullet A above, we were not able to obtain documentation to support that the suggested procedures outlined within the risk assessment was performed. As it relates to Bullet B above, for of the 4 of the 7 subrecipients selected for testwork consisted of the review and approval of subrecipient invoices. Per review of the invoices, the invoice contained a summary of costs incurred by the subrecipient by category of expense that it was seeking reimbursement for. It was evident through the invoice review that the Department often followed up on inconsistencies on hours worked with the subrecipient to help ensure the accuracy of the invoice reviewed. While this detailed review was performed, the Department did not perform any other monitoring procedures related to these 4 subrecipients to ensure the accuracy of the request made by the subrecipient through either a desk review or an on-site monitoring visit. As such, it is unclear if the monitoring performed was sufficient to ensure that the subrecipient was complying with the terms and conditions of its subrecipient grant agreement.

Finding Reference Number: 2023-018 NH Department of Health and Human Services Child Support Enforcement (ALN #93.563) Federal Award Number: 2201 NHCSES, 2301NHCSES Federal Award Year: 2022, 2023 U.S. Department of Health and Human Services Compliance Requirement: Period of Performance Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria This program operates on a cash basis and each year’s funding and accounting is discrete; i.e., there is no carry-forward of unobligated funds. To be eligible for federal funding, claims must be submitted to ACF within two years after the calendar quarter in which the state made the expenditure. This limitation does not apply to any claim for an adjustment to prior year costs or resulting from a court-ordered retroactive adjustment (45 CFR sections 95.7, 95.13 and 95.19) 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the period of performance, we identified the following: A. For 3 of 40 payments selected for testwork that was charged during the last 60 days of the federal fiscal year 2022 federal grant, we identified there was no evidence that the payment had been reviewed and approved. All 3 sample items were related to journal entry vouchers charged to the program. As a result, it is unclear if the payment should have been charged to the federal award. B. For 4 of 40 payments selected for testwork that was charged during the first 60 days of the federal fiscal year 2023 federal grant, we identified there was no evidence that the payment had been reviewed and approved. All 4 sample items were related to journal entry vouchers charged to the program. As a result, it is unclear if the payment should have been charged to the federal award. Cause The cause of the condition found is that the Department does not appear to have sufficient internal controls to document the review and approval of journal entry vouchers that are charged to the program to support that the journal entry voucher has been properly authorized to be charged to the federal program. Effect The effect of the condition found is that unauthorized expenses may have been charged inappropriately to grant period based on the period of service in cost was paid. Questioned Costs $3,250 Recommendation We recommend that the Department review its existing policies and procedures related to the review and approval of journal entry vouchers to ensure that internal controls are implemented to document the review and approval of all journal entry vouchers to support that the journal entry voucher has been authorized to be charged to the federal program. View of Responsible Officials: Management concurs with the above finding.

Finding Reference Number: 2023-019 NH Department of Education Disability Insurance/SSI Cluster: Social Security-Disability (Assistance Listing #96.001) Federal Award Numbers: 1904NHDI00, 2024NHDI00, 2104NHDI00, 2204NHI00, 2304NHDI00 Federal Award Year: 2019, 2020, 2021, 2022, 2023 U.S. Social Security Administration Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No The SSA-4514, Time Report of Personal Services For Disability Determination Services, is due quarterly to account for employee time. The SSA-4513 – State Agency Report of Obligations for SSA Disability Programs – is due quarterly for each fiscal year still open in order to account for program disbursements and unliquidated obligations (POMS DI 39506.202). Additionally, 2 CFR 200.303 (a) states that non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting related to the SSA-4514 quarterly report, we identified the following: A. For the quarter ending September 30, 2022, the SSA-4514 report understated the reported number of hours as follows: a. Examiners duty hours by 241 hours and holiday/leave time by 7.50 hours. b. Hearing officers duty hours of 480 hours and holiday/leave time by 15 hours B. For the quarter ending June 30, 2023, the SSA-4514 report understated the reported number as follows: a. Hearing officers duty hours of 480 hours and holiday/leave time by 7.5 hours. During our testwork over federal reporting related to the SSA-4513 quarterly report, we identified the following: C. For all 10 SSA-4513 reports selected for testwork, line item 7 was not checked to identify if the SSA-871 needed to be attached to the report. It is unclear if this needed to be attached or not. D. For all 10 SSA-4513 reports selected for testwork, the reports did not reconcile to the internal tracking sheets provided to validate the amounts reported. For all reports there were variances between the tracking sheets and the dollar amounts included within the federal report within sections 1, 2, 3 and 4. While variances are identified, we noted that the variances were not material overall to the individual line item. E. For all 10 SSA-4513 reports selected for testwork, we were unable to validate the completeness and accuracy of the amounts reported within Section 1 for Columns (A) for Disbursements, (B) for unliquidated obligations and (C) total obligations for line items 1, 2, 3 and 4. As such, we are not able to validate that the amounts reported are complete and accurate. As we were not able to obtain documentation to validate the obligation balances, we are unable to validate the accuracy of amounts reported within Sections 1, 2, and 3 of the report. F. For all 10 of the SSA-4513 reports selected for testwork, documentation was not provided for all line items contained in the report. Specifically we identified the following: a. For 2 of 10 SSA-4513 reports selected for testing, documentation was not provided for Columns (A), (B) and (C) for the following line items: i. Line 2.a.1 Disability (DI) Claims ii. Line 2.a.2 Supplemental Security Income (SSI) Claims iii. Line 1.a.3 Concurrent DI/SSI Claims iv. Line 2.b.1 Disability (DI) Claims v. Line 2.b.2 Supplemental Security Income (SSI) Claims vi. Line 1.b.3 Concurrent DI/SSI Claims vii. Line 3 Indirect Costs b. For 2 of 10 SSA-4513 reports, documentation was not provided for Line Item Section 2. Other Nonpersonnel Costs per SSA-4513 (Total Obligation) c. For 7 of 10 SSA-4513 reports documentation was not provided for Line Item Section 2 Total Adjusted All Other Nonpersonnel Costs (B) d. For 10 of 10 SSA-4513 documentation was not provided for Line Item Section 2.d, Other: Identify obligation & amount G. For 3 of 10 SSA-4513 reports selected for testwork, we identified while there were no expenditures incurred for the federal grant between October 1, 2022 and June 30, 2023, the expenditures for the quarter selected, June 30, 2022, did not agree to what was reported for the quarter ending September 30, 2023. We were unable to obtain supporting documentation as to why the amounts reported were different. Cause The cause of the condition found related to the SSA-4514 was due to formula errors within the spreadsheet used to calculate the quarterly hours. The formulas were not updated to reflect any new lines of data that may have been added and needed to be includes within the total formulas included in the spreadsheet. While the spreadsheets were reviewed as part of the existing internal control procedures, the review as not at a precision level that detected the formula errors. The cause of the condition found related to the SSA-4513 was due to insufficient policies and procedures to ensure that all necessary documentation is maintained to support the amounts reported for each federal report filed. Based on the documentation that was provided to support the data reported within each quarterly report, it is unclear if the internal control review procedures performed included a detail review over each line item of the report to ensure the amount reported is complete and accurate. Effect The effect of the condition found is the SSA-4514 and SSA-4514 reports were not complete and accurate when they were filed. Questioned Costs None Recommendation We recommend that the existing internal control procedures over the review and approval of the SSA-4514 report are evaluated to ensure that the accuracy of spreadsheet formulas used are appropriate and capture all of the data necessary to accurately prepare the SSA-4514. In addition, we recommend that the existing policies and procedures be developed to ensure that all documentation to support the amounts reported on the SSA-4513 is properly maintained for each quarterly report. In addition, the existing internal control procedures should be evaluated to ensure that as part of the review process, each line item on the federal report is verified against the supporting documentation to ensure the report is complete and accurate. The review performed should also be properly documenting showing that the required review process was performed prior to submitting the SSA-4513. View of Responsible Officials: Managementconcurs with the above finding.

Finding Reference Number: 2023-020 NH Department of Education Disability Insurance/SSI Cluster: Social Security-Disability (Assistance Listing #96.001) Federal Award Numbers: 1904NHDI00, 2024NHDI00, 2104NHDI00, 2204NHI00, 2304NHDI00 Federal Award Year: 2019, 2020, 2021, 2022, 2023 U.S. Social Security Administration Compliance Requirement: Special Tests and Provisions – Qualified Providers Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria Each state agency is responsible for comprehensive oversight management of its process and for ensuring accuracy, integrity, and economy of its processes (20 CFR sections 404.519g and 416.919g, and POMS DI 396569.300). As part of these duties, DDSs must have, and follow procedures for performing medical license verifications to ensure that only qualified providers perform DDSs tasks. By “qualified,” SSA means that the medical source must: 1. Be currently licensed in the state and have the training and experience to perform the type of examination or tests DDS requests; and 2. Not be barred from participating in Medicare or Medicaid programs or other federal or federally assisted programs (20 CFR sections 404.5159g and 416.919g). Prior to using the services of any medical provider, the DDS must check the System of Award Management (SAM) website. Additionally, 2 CFR 200.303 (a) states that non-federal entities must establish and maintain effective internal control over federal awards that provide reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over the special test and provision related to qualified providers, we identified the following: A. For all 4 new providers selected for testwork, the SAM.gov website was not utilized to verify the suspension and debarment status for new providers. B. For 7 existing providers selected for testwork, we identified: a. For 4 of 7 annual reviews selected for testwork, there was no documentation maintained to verify that the providers medical license or suspension and debarment status had been reviewed. b. For 2 of 7 annual reviews selected for testwork, there was no documentation maintained that the providers suspension and debarment status had been reviewed. c. For 1 of 7 annual reviews selected for testwork, there was no documentation that an annual review of the provider had been performed. Cause The cause of the condition found is primarily due to insufficient policies and procedures to verify a provider’s suspension and debarment status has been reviewed within SAM.gov as required by the federal regulations. For new providers, the Office of Inspector General’s List of Excluded Individuals/Entities (LEIE) was reviewed, however the review took place after the provider was already hired. In addition, there does not appear to be any policies and procedures in place to document how an annual review should be conducted and what documentation needs to be maintained to support the procedures performed. There does not appear to be any internal controls in place to ensure that reviews are complete and properly documented. Effect The effect of the condition found is that documentation to support the qualifications of providers has not been appropriately maintained and providers could have been used that did not meet the criteria to be a qualified provider. Questioned Costs None Recommendation We recommend that written policies and procedures been developed to outline what the required procedures are related to reviewing professional licenses and suspension and debarment status for new providers and as part of the annual review process for existing providers. The policies should describe how the reviews will be performed, how the review will be documented. Internal controls should be implemented to ensure that an appropriate review over the review is conducted to ensure that the review is complete and accurate. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-021 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Special Tests and Provisions - Project Accounting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria For large projects, the recipient is required to make an accounting to FEMA of eligible costs. Similarly, the subrecipient must make an accounting to the recipient. In submitting the accounting, the entity is required to certify that reported costs were incurred in performance of eligible work, that the approved work was completed, that the project is in compliance with the provisions of the FEMA-State Agreement, all grant conditions were met, and that payments for that project were made in accordance with the applicable payment provisions. For improved and alternate projects, if the total cost of the projects does not equal or exceed the approved eligible costs, then the auditor should expect to see an adjustment to reduce eligible costs (44 CFR section 206.205). Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During testwork over the Special Test- Project Accounting, the engagement team sampled 7 ongoing, large projects and 3 large, closed projects out of a total of 48 and 10, respectively. The engagement team noted the following: For 5 out of the 7 ongoing projects and for 2 out of the 3 closed projects, the Department could not provide evidence of project accounting reporting to FEMA in compliance with required certification. Specifically, the Department has a process whereby the Project Completion and Certification reports are to be completed and submitted to HSEM by subrecipients within 90 days of the project obligation date. HSEM then submits a certification report on the first of each month on the reports submitted during the previous month. However, the engagement team requested evidence of the certification report to FEMA and it could not be provided. Per discussion with HSEM staff, during the audit period, some of the emails were sent from individual employee state issued email addresses of individuals who no longer are employed by the Department and were not saved. Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the control not being at a precision level to ensure the accounting certification reports were sent to FEMA and maintained as evidence of control operation. Effect The effect of the condition found is that the Department did not comply with 44 CFR section 206.205 and 45 CFR section 75 303(a). Questioned Costs None. Recommendation We recommend that the Department enhance policies and procedures which include internal controls to ensure project accounting completion and certification reports are sent to FEMA and maintained on file as evidence of compliance with the Project Accounting certification requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-021 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Special Tests and Provisions - Project Accounting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria For large projects, the recipient is required to make an accounting to FEMA of eligible costs. Similarly, the subrecipient must make an accounting to the recipient. In submitting the accounting, the entity is required to certify that reported costs were incurred in performance of eligible work, that the approved work was completed, that the project is in compliance with the provisions of the FEMA-State Agreement, all grant conditions were met, and that payments for that project were made in accordance with the applicable payment provisions. For improved and alternate projects, if the total cost of the projects does not equal or exceed the approved eligible costs, then the auditor should expect to see an adjustment to reduce eligible costs (44 CFR section 206.205). Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During testwork over the Special Test- Project Accounting, the engagement team sampled 7 ongoing, large projects and 3 large, closed projects out of a total of 48 and 10, respectively. The engagement team noted the following: For 5 out of the 7 ongoing projects and for 2 out of the 3 closed projects, the Department could not provide evidence of project accounting reporting to FEMA in compliance with required certification. Specifically, the Department has a process whereby the Project Completion and Certification reports are to be completed and submitted to HSEM by subrecipients within 90 days of the project obligation date. HSEM then submits a certification report on the first of each month on the reports submitted during the previous month. However, the engagement team requested evidence of the certification report to FEMA and it could not be provided. Per discussion with HSEM staff, during the audit period, some of the emails were sent from individual employee state issued email addresses of individuals who no longer are employed by the Department and were not saved. Cause The Department’s internal controls were properly designed; however, the cause of the condition is due to the operating effectiveness of the control not being at a precision level to ensure the accounting certification reports were sent to FEMA and maintained as evidence of control operation. Effect The effect of the condition found is that the Department did not comply with 44 CFR section 206.205 and 45 CFR section 75 303(a). Questioned Costs None. Recommendation We recommend that the Department enhance policies and procedures which include internal controls to ensure project accounting completion and certification reports are sent to FEMA and maintained on file as evidence of compliance with the Project Accounting certification requirements. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-022 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-032 Statistically Valid Sample: No Criteria The SF-425, Federal Financial Report, is required to be filed annually. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the reporting, we noted the following: A. We noted for 1 out of 9 SF-425’s tested the total federal funds authorized (line 10d) per the SF-425 report did not agree to the SAG Smartlink Report. The SF-425 for disaster #4329 for the quarter ended 6/30/23 reported $6,893,951, while Smartlink reported $7,173,317. The Department did not update this amount on the SF 425, as the line should have read $7,173,317. The amount reported was the balance from the prior quarter. B. We noted for an additional 2 out of 9 SF-425s tested the recipient share figures (lines 10i-10k) were incorrectly calculated. When disaster declarations were made for disasters #4622 and #4624, the federal share was 75%. However, on August 8, 2022, amendments were executed that updated the federal share to 90%. When calculating the recipient share amounts on the SF-425s for these two disasters, HSEM utilized the old recipient share of 25%.One SF-425 report for disaster #4622 for the quarter ended 6/30/23 reported $338,319.94 for the total recipient shared required (line 10i) and $305,440.94 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $32.879. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $112,773.31, $101,813.65, and $10,959.66. The SF-425 report for disaster #4624 for the quarter ended 12/31/22 reported $204,156.96 for the total recipient shared required (line 10i) and $194,774.41 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $9,382.54. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $68,052.32, $64,924.80, and $3,127.52. Cause The cause of the condition found was primarily due to insufficient internal controls related to reporting. Specifically, there were no internal controls in place to detect inaccuracies in amounts reported on the SF-425 reports. Effect The effect of the condition found is that the Department did not file SF-425 reports accurately. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls over financial reporting at a precision level sufficient to ensure the accuracy of its federal reporting. We recommend that the Department revise the inaccurate SF-425 reports and resubmit the corrected versions. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-022 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Reporting Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: 2022-032 Statistically Valid Sample: No Criteria The SF-425, Federal Financial Report, is required to be filed annually. Additionally, Title 45 U.S. Code of Federal Regulation Part 75 (45 CFR section 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HS Awards, section 75.303(a), Internal Controls, states the non-Federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-Federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition During our testwork over federal reporting as part of the reporting, we noted the following: A. We noted for 1 out of 9 SF-425’s tested the total federal funds authorized (line 10d) per the SF-425 report did not agree to the SAG Smartlink Report. The SF-425 for disaster #4329 for the quarter ended 6/30/23 reported $6,893,951, while Smartlink reported $7,173,317. The Department did not update this amount on the SF 425, as the line should have read $7,173,317. The amount reported was the balance from the prior quarter. B. We noted for an additional 2 out of 9 SF-425s tested the recipient share figures (lines 10i-10k) were incorrectly calculated. When disaster declarations were made for disasters #4622 and #4624, the federal share was 75%. However, on August 8, 2022, amendments were executed that updated the federal share to 90%. When calculating the recipient share amounts on the SF-425s for these two disasters, HSEM utilized the old recipient share of 25%.One SF-425 report for disaster #4622 for the quarter ended 6/30/23 reported $338,319.94 for the total recipient shared required (line 10i) and $305,440.94 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $32.879. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $112,773.31, $101,813.65, and $10,959.66. The SF-425 report for disaster #4624 for the quarter ended 12/31/22 reported $204,156.96 for the total recipient shared required (line 10i) and $194,774.41 for recipient share of expenditures (line 10j). As a result, the remaining recipient share to be provided (line 10k) was reported as $9,382.54. Using the appropriate recipient share of 10%, we determined that lines 10i, 10j and 10k should have been reported, respectively, as follows $68,052.32, $64,924.80, and $3,127.52. Cause The cause of the condition found was primarily due to insufficient internal controls related to reporting. Specifically, there were no internal controls in place to detect inaccuracies in amounts reported on the SF-425 reports. Effect The effect of the condition found is that the Department did not file SF-425 reports accurately. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls over financial reporting at a precision level sufficient to ensure the accuracy of its federal reporting. We recommend that the Department revise the inaccurate SF-425 reports and resubmit the corrected versions. View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-023 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements – Clearly identify to the subrecipient: (1) the award as a subaward at the time of subaward (or subsequent subaward modification) by providing the information described in 2 CFR section 200.332(a)(1); (2) all requirements imposed by the PTE on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and the terms and conditions of the award (2 CFR section 200.332(a)(2)); and (3) any additional requirements that the PTE imposes on the subrecipient in order for the PTE to meet its own responsibility for the federal award (e.g., financial, performance, and special reports) (2 CFR section 200.332(a)(3)). 2. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 3. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During the year ended June 30, 2023, $27,041,873 was passed through to 85 subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following: A. The Department communicates award information to subrecipients through the approved agreement. Per review of the agreement, for each of the 27 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332(a). Specifically, the following elements were not communicated: - Subrecipient unique entity identifier (not communicated for 19/27); - Federal Award Identification Number (FAIN) (not communicated for 27/27); - Identification of whether the award is R&D (not communicated for 27/27); and - Indirect cost rate for the federal award (including if the de minimis rate is charged) (not communicated for 27/27) B. The Department evaluated the subrecipient risk of noncompliance through a risk assessment for each of the 13 subrecipients selected for testwork. However, there was no formal risk assessment policy in place that indicated how frequently risk assessments should be performed. As a result, 5 subrecipients did not have risk assessments performed during the current year for purposes of determining the appropriate subrecipient monitoring response. These prior fiscal year(s) risk assessments were performed as of the following dates: September 2019, October and December 2021, May and June 2022. C. For each of the 13 subrecipients selected for testwork, the Department did not perform any during the award monitoring. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted there were no UG report review policies and procedures in place. For the 13 subrecipients selected for testwork, 6 subrecipients were identified in which the Department did not review the most recent uniform guidance report issued. Specifically, we noted: • For 5 of 13 subrecipients, the subrecipient’s uniform guidance was not reviewed due to updated risk assessments not being performed in the current year (refer to item 2 above) • For 1 of 13 subrecipients, the current year risk assessment was performed prior to the receipt of the subrecipient’s uniform guidance report and management did not go back to review the report Cause The cause of the condition found was primarily due to the Department not performing their sub monitoring internal controls in accordance with written formal policies and procedures. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a-h) and 2 CFR section 200.501(h). View of Responsible Officials: Management concurs with the finding above.

Finding Reference Number: 2023-023 NH Department of Safety Disaster Grants – Public Assistance (Presidentially Declared Disasters) and COVID-19 Public Assistance (Presidentially Declared Disasters) (Assistance Listing #97.036) Federal Award Numbers: FEMA-4622-DR-NH, FEMA-4624-DR-NH, FEMA-4457-DR-NH, FEMA-4370-DR, FEMA-4693-DR, FEMA-4355-DR, FEMA-4329-DR, FEMA-4516-DR-NH Federal Award Year: July 17-19, 2021, July 29-30, 2021, July 11-12, 2019, March 2-8, 2018, December 22-December 25, 2022, October 29-November 1, 2017, July 1-2, 2017, January 20, 2020 U.S. Department of Homeland Security Compliance Requirement: Subrecipient Monitoring Type of Finding: Material Weakness and Material Noncompliance Prior Year Finding: None Statistically Valid Sample: No Criteria A pass-through entity (PTE) must: 1. Identify the Award and Applicable Requirements – Clearly identify to the subrecipient: (1) the award as a subaward at the time of subaward (or subsequent subaward modification) by providing the information described in 2 CFR section 200.332(a)(1); (2) all requirements imposed by the PTE on the subrecipient so that the federal award is used in accordance with federal statutes, regulations, and the terms and conditions of the award (2 CFR section 200.332(a)(2)); and (3) any additional requirements that the PTE imposes on the subrecipient in order for the PTE to meet its own responsibility for the federal award (e.g., financial, performance, and special reports) (2 CFR section 200.332(a)(3)). 2. Evaluate Risk – Evaluate each subrecipient’s risk of noncompliance for purposes of determining the appropriate subrecipient monitoring related to the subaward (2 CFR section 200.332(b)). 3. Monitor – Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f)). In addition to procedures identified as necessary based upon the evaluation of subrecipient risk or specifically required by the terms and conditions of the award, subaward monitoring must include the following: a. Reviewing financial and programmatic (performance and special reports) required by the PTE. b. Following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the PTE detected through audits, on-site reviews, and other means. c. Issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the PTE as required by 2 CFR section 200.521. Additionally, 45 CFR section 75 303(a) states the non Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition As part of the Disaster Grants - Public Assistance program (DGPA), the New Hampshire Department of Safety - Homeland Security and Emergency Management (the Department) enters into grant agreements with local municipalities to provide reimbursement for expenditures incurred as a result of New Hampshire declared disasters. During the year ended June 30, 2023, $27,041,873 was passed through to 85 subrecipients. As part of our testwork over the subrecipient monitoring process, we noted the following: A. The Department communicates award information to subrecipients through the approved agreement. Per review of the agreement, for each of the 27 subrecipients selected for testwork, the Department did not communicate all the required award information as outlined in 2 CFR section 200.332(a). Specifically, the following elements were not communicated: - Subrecipient unique entity identifier (not communicated for 19/27); - Federal Award Identification Number (FAIN) (not communicated for 27/27); - Identification of whether the award is R&D (not communicated for 27/27); and - Indirect cost rate for the federal award (including if the de minimis rate is charged) (not communicated for 27/27) B. The Department evaluated the subrecipient risk of noncompliance through a risk assessment for each of the 13 subrecipients selected for testwork. However, there was no formal risk assessment policy in place that indicated how frequently risk assessments should be performed. As a result, 5 subrecipients did not have risk assessments performed during the current year for purposes of determining the appropriate subrecipient monitoring response. These prior fiscal year(s) risk assessments were performed as of the following dates: September 2019, October and December 2021, May and June 2022. C. For each of the 13 subrecipients selected for testwork, the Department did not perform any during the award monitoring. D. During our testwork over the Department’s review of subrecipient uniform guidance reports, we noted there were no UG report review policies and procedures in place. For the 13 subrecipients selected for testwork, 6 subrecipients were identified in which the Department did not review the most recent uniform guidance report issued. Specifically, we noted: • For 5 of 13 subrecipients, the subrecipient’s uniform guidance was not reviewed due to updated risk assessments not being performed in the current year (refer to item 2 above) • For 1 of 13 subrecipients, the current year risk assessment was performed prior to the receipt of the subrecipient’s uniform guidance report and management did not go back to review the report Cause The cause of the condition found was primarily due to the Department not performing their sub monitoring internal controls in accordance with written formal policies and procedures. Questioned Costs None. Recommendation We recommend that the Department develop policies and procedures and implement internal controls to ensure that the Department complies with 2 CFR section 200.332(a-h) and 2 CFR section 200.501(h). View of Responsible Officials: Management concurs with the finding above.